Central Bank Actions Easing Global Credit Crunch: US Treasury

Source : The Straits Times, May 26, 2008

TOKYO - AN assistant US Treasury secretary said on Monday the global credit crunch is gradually easing following efforts by the US Federal Reserve and other central banks.

Mr Clay Lowery, assistant secretary for international affairs at the US Department of the Treasury, said the Fed and other central banks have coordinated their actions to protect the financial system since the US subprime mortgage crisis surfaced last year.

As a result, the availability of credit has improved 'modestly,' Mr Lowery told the Foreign Correspondents Club of Japan.

'Already, we have seen some indication that this combination of actions is beginning to have the desired effect,' he said.

He also urged Japan to do more to prove its openness to foreign investment. Japan still lags behind other industrialised nations in encouraging investment from overseas, he said.

'It is therefore important that Japan sends a clear message that it is open to foreign investment,' he said.

The Japanese government recently rejected a request from British hedge fund The Children's Investment Fund to boost its stake in a major utility, Electric Power Development Co, or J-Power. -- AP