TOKYO, April 14: The number of corporate bankruptcies in Japan rose for the second straight month in March, a research firm said on Friday, warning that a number of small firms are still under deflation pressure.

The month of March saw 848 cases of bankruptcies leaving liabilities of at least 10 million yen ($85,000) each, or more, across the nation, up 9.1 per cent from 777 in February, Teikoku Databank said in a monthly report.

Combined liabilities left by collapsed firms last month jumped 45.7 per cent from February to 473.96 billion yen, the research firm said.

“While major companies are on course to recovery, thanks to the nation’s economic pick-up, many small and medium-size firms, especially in local regions, are still struggling to fight the impact of the lingering deflation,” a research official said.

“Such a trend is likely to continue for the time being,” the official said, adding that the research firm will closely monitor the impact of rising interest rates on small businesses.

Japan’s government on Friday voiced concern about recent sharp rises in long-term interest rates as markets brace themselves for an end to near-zero borrowing costs.

“I basically believe deflation still lingers although it is mild. In this situation, it is never desirable that interest rates alone are surging rapidly,” Finance Minister Sadakazu Tanigaki told reporters.

The Bank of Japan last month scrapped its deflation-fighting policy of flooding the financial system with cash and many economists now expect it to scrap near-zero interest rates as early as this summer.—AFP