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Bank of Japan Keeps Interest Rates Near Zero


Japan's Central Bank will keep its near-zero rates while General Motors will sell its stake in Isuzu Motors.

The Bank of Japan will continue its policy of holding interest rates at nearly zero for now. The bank board unanimously agreed not to raise rates.

For the past five years Japan has had an ultra-loose monetary policy, implemented to end nearly seven years of falling consumer prices, and to make it easier for companies to borrow funds.

B.O.J. Governor Toshihiko Fukui says the bank will ensure that consumer prices do not resume falling. However, at a recent press conference he declined to say if interest rates would be increased in the future.

"We are still in the process of absorbing liquidity in the financial market and we have no prejudgment on the next step," said Fukui.

General Motors, which is the world's largest automaker, will sell its stake in Japan's Isuzu Motors as part of a restructuring plan. It expects to receive $300 million from the sale to a Japanese bank and two Japanese trading companies. General Motors owned a seven-point nine percent stake in Isuzu.

Isuzu President Yoshinori Ida talked about the company's goals at a recent press conference, emphasizing the focus on trucks and vans.

"We plan to be independent without any partners. We are aiming to become a global leader of C.V. [commercial vans] and diesel engines," said Ida.

Inpex Corporation, which is Japan's top natural resource developer, is preparing to invest $5 billion to $6 billion in a liquid natural gas project in Australia. Inpex plans to produce liquid natural gas off the northwest coast of Australia starting in 2012.

The corporation owns 100 percent of the Australian field, which holds about six trillion cubic feet of gas. Inpex intends to export the gas to Japan, supplying 10 percent of the country's demand.

Japan's Sony Corporation and South Korea's Samsung Electronics, the world's largest maker of liquid-crystal displays, have agreed to join forces and build the industry's biggest flat-panel factory.

They will split the two billion dollar cost equally. The plant, which will be built in South Korea, will start production of flat-panel screens next year.

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