Japan Weighs Dollar Support for Banks Funding $550 Billion U.S. Deal
Updated
Updated · Japan Today · Jul 12
Japan Weighs Dollar Support for Banks Funding $550 Billion U.S. Deal
2 articles · Updated · Japan Today · Jul 12
Summary
$550 billion in Japan-backed U.S. investment commitments may get government dollar-funding support as Tokyo studies a framework for MUFG, SMBC and Mizuho.
Major banks say securing enough dollars on their own would be too costly, prompting the Finance Ministry to discuss long-term funding with the Japan Bank for International Cooperation.
One option would tap dollars in Japan's Foreign Exchange Fund Special Account, reflecting concern that large private-market purchases could disrupt currency markets.
$2.22 billion has already been lined up for the first projects, while the broader package includes $36 billion agreed initially and a second round worth up to $73 billion.
The funding plan would help execute last year's U.S.-Japan trade deal, which set U.S. tariffs on Japanese goods and autos at 15% in exchange for Tokyo's investment package.