TOKYO, April 2 Reuters The amount of money circulating in Japan soared by a fifth to hit a record in March as central bank pumped out cash to cushion blows to the economy from the COVID19 pandemic.

The average balance of monetary base, or the amount of cash in circulation and deposits at the BOJ, rose 20.8 in March from a year earlier to 613.4 trillion yen 5.5 trillion, marking the fastest annual gain since February 2017, central bank data showed on Friday.

The increase was driven largely by a surge in the BOJs purchases of shortterm securities and demand for its loan scheme aimed at channelling funds to COVIDhit firms.

Financial institutions deposits parked at the BOJ also soared, climbing 25.1 to a record 492.5 trillion yen.

Many analysts expect the BOJ to keep its money spigot wide open as Governor Haruhiko Kuroda has stressed its nearterm focus would be to support the pandemichit economy.

Japans economy is gradually recovering from pandemicinduced pain thanks to robust exports, though a slow vaccine rollout and climbing coronavirus infections, particularly in the city of Osaka, cloud the outlook.

Critics have urged the BOJ to focus more on the rising costs of its prolonged easy monetary policy, such as the damage done by ultralow interest rates to bank profits.

The central bank decided last month to address the sideeffects of its prolonged monetary easing with a review of its tools, which have led to plans to trim its bond purchases from April.

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