. second, it established a new arrangement for loans of 500 billion yen for small - lot investments and loans ( 1 million yen or more but less than 10 million yen ). third, the bank raised the ceiling for the outstanding balance of loans under the existing arrangement from 3 trillion yen to 3. 5 trillion yen. and fourth, with a view to support financial institutions ’ efforts also from the side of foreign currency funds provisioning, the bank established a new arrangement for providing loans in u. s. dollars to the equivalent of 1 trillion yen, using the u. s. dollar reserves held by the bank. details of the measures will be examined at the next monetary policy meeting to be held on april 9 and 10, 2012. as a result of the measures, the outstanding balance of loans under the arrangements will increase from 3. 5 trillion yen to 5. 5 trillion yen. up to now, i have described the bank ’ s efforts to overcome deflation and discussed things to keep in mind by focusing on the policy decisions made recently. in the actual conduct of monetary policy, based on the outlook for economic activity and prices, it is necessary to respond carefully and decisively by identifying the timing and measures while monitoring a range of conditions and possibilities. the bank will continue to do its utmost as the central bank by pursuing powerful monetary easing to overcome deflation, ensure financial market stability, and provide support to strengthen the foundations for economic growth. concluding remarks : the economy of chiba prefecture in my conclusion, let me touch on the economy of chiba prefecture. the great east japan earthquake in march 2011 caused tremendous damage to the region, including fires, tsunami, and soil liquefaction. one year has passed since the disaster occurred. let me express once again my heartfelt condolences to the victims of the disaster and their families. i also salute the local citizens, firms, and governments for their efforts to achieve restoration and reconstruction. bis central bankers ’ speeches chiba prefecture is bounded by water on three sides, and it is blessed with mild weather and rich natural surroundings. it has a strong agricultural sector with an array of crops that rank first nationwide in terms of output, including peanuts, japanese radishes, green soybeans, and japanese pears, and its agricultural output as a whole ranks third in the nation. chiba prefecture also ranks high in terms of fisheries, with plenty of fishing ports, including the nation ’ s largest, in the city of choshi. the coastal area contains the

not an easy one to make, particularly because we had been very active in the founding of the bretton woods institutions and the global fixed - rate system. canada had struggled to stay within this system during the late 1940s. but by 1950, sharply higher commodity prices and strong capital inflows into our resource sector led to upward pressure on the canadian dollar. in addition, there were speculative short - term capital inflows, which added to the upward pressure on the currency. to maintain the fixed exchange rate, the canadian authorities first intervened on a massive scale. foreign exchange reserves rose by 40 per cent in less than three months, and the money supply grew rapidly at a time when the domestic economy was already operating at capacity. given the desire to both maintain stable domestic prices and to avoid an economic boom that could lead to a bust later on, canadian authorities felt that they had two options. one was to revalue the canadian dollar ; the other was to let the canadian dollar float. the imf strongly favoured a revaluation - but to what level? it was impossible to know exactly what the correct level for the currency should be. so canada chose to float the dollar. we allowed the market to set its own level for the currency, with the intention of re - fixing the canadian dollar at a new level later on. what was surprising was just how quickly the speculative flows eased once we floated our currency. as it turned out, the canadian dollar appreciated by just 5 per cent during the following three months. while the imf was very critical of canada ’ s decision to float, it accepted our action on the condition that this move would be temporary. the imf expected canada to return to the bretton woods system as soon as a new equilibrium rate for the canadian dollar was found. but the flexible exchange rate worked better than almost all observers had expected, and the “ temporary period ” lasted for 12 years. with the exchange rate allowed to float freely, the bank of canada was able to direct monetary policy to the needs of the canadian economy. we were able to deal with the inflationary threat posed by rapid economic growth and strong investment flows. with the appreciation of the canadian dollar and with the end of the speculative flows, inflation came down from more than 10 per cent in 1950 to under 3 per cent by 1952. like most other countries at the time, canada had extensive foreign exchange controls in place when it floated the canadian dollar. but with growing confidence in the functioning of currency markets