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by Staff Writers Tokyo (AFP) Oct 31, 2011 Japan has promised to keep buying eurozone bailout bonds, the head of the crisis fund told reporters on Monday, as the EU looks for outside help to solve its crippling debt problems. The pledge will come as a relief to Klaus Regling, head of the European Financial Stability Facility, who came away empty handed from a mercy mission to Beijing last week. "The Japanese government will continue to buy the EFSF bonds that we have been issuing," Regling said, Kyodo news reported. Regling was speaking after meeting in Tokyo with Takehiko Nakao, Japan's top financial diplomat, on the latest stop of a tour widely believed to be aimed at shoring up support for the EU's efforts to stem a crisis that has sent ripples through the world economy. Japan has so far purchased around 20 percent of the debt issued by the continent's bailout fund, and had indicated its willingness to buy more. However, Dow Jones Newswires said officials had stopped short of guaranteeing they would maintain this level of support. "I told (Regling) that we will continue to purchase EFSF bonds," one unnamed finance ministry official said, according to the agency. After a marathon meeting in Brussels last week EU leaders announced measures including more than trebling the firepower of the fund to one trillion euros ($1.4 trillion) from 440 billion euros. But with the European governments wary of putting more money into the fund, Regling was forced to look abroad. He arrived in Tokyo over the weekend after a visit to Beijing during which China said it would seek more clarity before stumping up cash for the bailout. On Friday Prime Minister Yoshihiko Noda offered vague promises that he would help Europe overcome its sovereign debt crisis, but gave no details on what form this help might take. "During the upcoming G20 summit, I will map out Japan's contribution to settling down the global economic crisis sparked from Europe," Noda told parliament, referring to the gathering of global heads in France this week. "Our determination and capacity as politicians is challenged at a time like this when a storm blown from Europe is ripping through global financial markets." His remarks, in a policy speech, came after Japan's Finance Minister Jun Azumi said Tokyo was ready to take "necessary measures" to help revamp the eurozone in the interests of its own economy. Japan, already stumbling to recover from the effects of the March earthquake and tsunami and the nuclear emergency they sparked at Fukushima, is facing further headwinds from the slowdown in global trade. The country's vital export sector is also battling a stubbornly strong yen, hitting profits and threatening domestic production, as investors flock to the currency as a safe haven, pushing up its value. On Monday, Japan intervened in the currency market for the first time since August to drive down the value of the yen after it hit yet another post-war high against the dollar. Azumi told reporters that Japan's move was unilateral and did not comment on the size of the intervention, but one analyst predicted it had been bigger than the last intervention in August. The dollar climbed to 79.40 yen at around 0630 GMT after hitting a low of 75.32 yen in Oceanian trade earlier Monday. The euro was at 111.08 yen from 107.06 yen struck earlier Monday. Manufacturers have also been troubled by the uncertainty over Europe's persistent debt problems. After 10 hours of tense talks in Brussels, Europe's leaders on Thursday thrashed out a deal aimed at providing new funds to Greece in a bid to stop the region's crippling debt troubles sparking another global financial meltdown.
The Economy
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