clarification of the range of fluctuations in long - term interest rates ( ±0. 25 % ) strike a balance between securing effects of monetary easing and maintaining market functioning < interest scheme to promote lending > apply incentives ( linked to the short - term policy interest rate ) to financial institutions'( fis') current account balances, corresponding to the amount outstanding of funds provided through fund - provisioning measures to promote lending ― mitigate the impact on fis'profits at the time of rate cuts depending on the amount of lending ― the applied interest rates and the eligible fund - provisioning measures for each category will be changed as necessary at mpms depending on the situation. < decision at the march 2021 mpm > introduction of " fixed - rate purchase operations for consecutive days " applied interest rates category 3. new guideline for etf and j - reit purchases purchase etfs and j - reits as necessary with upper limits of about 12 tril. yen and about 180 bil. yen, respectively, on annual paces of increase in their amounts outstanding ( abolish the guideline for purchasing these assets, in principle, at annual paces of increase in their amounts outstanding of about 6 tril. yen and about 90 bil. yen, respectively ) purchase only etfs tracking the topix i 0. 2 % ii category iii • special operations in response to covid - 19, when funds are provided against loans made by fis on their own • special operations in response to covid - 19, when funds are provided against loans other than those for category i and against private debt pledged as collateral • • loan support program operation to support fis in disaster areas higher than the rate for category ii 0. 1 % category eligible fund - provisioning measures absolute value of the short - term policy interest rate 0 % lower than the rate for category ii

a banking union is crucial also for the euro area real economy. but, it can reasonably be asked, if a banking union is so important, why did this only become apparent in the last few years? the main reason is that the potential for financial fragmentation in the euro area was not recognised. policy - makers and observers did not fully appreciate the extent to which diverging fundamentals between different economies could feed through to the banking system. this applies notably to sovereign debt, and the two - way interaction between sovereign distress and bank distress. certainly, a banking union can play a major role in breaking the vicious circle we see in europe between banks and their sovereigns. but there is also a strong onus on governments to ensure that sovereign debt performs its expected function in the financial system – that is, as a risk - free, safe asset. let me therefore briefly turn to fiscal policies. the implications for fiscal policies it is welcome that governments in the euro area have made significant progress in consolidating their budgets, and hence removing some sovereign risk from the financial system. the primary fiscal deficit for the euro area has fallen from 3. 5 % of gdp in 2009 to around 0. 5 % in 2012. in the united states, by comparison, it was around 6 % of gdp in 2012. that said, we need to ensure time consistency. we all know the experience of the first decade of the euro. fiscal rules enshrined in the maastricht treaty were not sufficiently binding ; market discipline likewise did not work in an effective way. 5 for this reason, the ecb has long argued in favour of moving towards more effective rules in the fiscal domain. we are convinced that they are crucial for the stability of the common currency in the longer term. i am therefore encouraged that policy - makers in europe have been taking significant steps to strengthen the common fiscal rules. to quote the delors report : “ to some extent market forces can exert a disciplinary influence [ … ] however, the constraints imposed by market forces might either be too slow and weak or too sudden and disruptive. ” bayoumi et al. ( 1995 ) however provide some evidence in favour of market discipline on us data ; see t. bayoumi, m. goldstein and g. woglom ( 1995 ) : “ do credit markets discipline sovereign borrowers? evidence from u. s. states ”, journal of money, credit and banking, 27, 4, pp. 1046 – 1059