The Bank of Japan (BOJ) kept monetary policy steady by a unanimous vote on Wednesday, but revised up its forecast on expenditure – a traditionally weak indicator – a move that's viewed positively by analysts.
As expected, the central bank maintained its pledge to increase the monetary base at an annual pace of 60-70 trillion yen and kept its overall assessment that the world's third-biggest economy continues to recover moderately.
The yen weakened slightly to 101.37 against the U.S. dollar on the news.
"Our quantitative-easing policy is exerting its intended effects," BOJ governor Haruhiko Kuroda told a news conference after the decision on Wednesday. "The Bank of Japan will continue with this policy until the 2 percent target is achieved in a sustained manner."
Analysts say the BOJ is showing growing confidence in its outlook for the country, despite concerns the hike in the sales tax that took effect in April will hamper growth.