In addition, given that the tightness in corporate financing may increase further during the run-up to the end of the fiscal year, the Bank decided, last week, to introduce outright purchases of CP as a temporary measure, and to investigate how other corporate financing instruments may be employed as a central bank.
Since outright purchases of CP essentially undertake the credit risks of individual firms, they constitute an exceptional step taken by the central bank in light of the Bank's fundamental position that the main purpose of central bank operations is to provide liquidity.