The Bank of Japan on Friday cut its policy rate to just 0.1 per cent – three days after the US Federal reserve moved its rate almost to zero – and announced it would take the unorthodox step of directly buying commercial paper in order to ease a corporate credit crunch.

The 20 basis point reduction to the overnight call rate – the BoJ’s second in two months – came amid a slew of economic news and recent rises in the yen to 13-year highs.