A few months ago, economists suspected further stimulus from the Bank of Japan was likely this year to help take the sting out of a rise in Japan's sales tax. That prospect now looks less likely as the economy is showing signs of holding up well.
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"Market economists increasingly expect the Bank of Japan (BOJ) is unlikely to take additional action in haste because of the good numbers we've had," said Junko Nishioka, chief Japan economist at Royal Bank of Scotland in Tokyo. "Better economic fundamentals are encouraging the BOJ to keep its monetary policy on hold."
The BOJ ends a two-day meeting on Wednesday and is expected to maintain its current monetary policy, under which it plans to increase Japan's base money by 60-70 trillion yen ($589-$688 billion) a year via aggressive asset purchases.