The Bank of Japan's (BOJ) foray into negative interest rates hasn't yielded positive results, and the central bank's arsenal is getting thin.
That's spurring analysts to speculate the BOJ's next attempt at easing may target scooping up more assets in the stock market.
"They tried negative rates. It didn't work," Mark Matthews, head of research for Asia at private bank Julius Baer, told CNBC Wednesday. "I think what they will do … is they will announce more quantitative easing, probably through equities."
Analysts have said they expect the BOJ to ease policy further as economic growth forecasts remain anemic and inflation is still well below the central bank's target of 2 percent.
The rise in the yen has also fanned concerns over the impact on exports. Finance Minister Taro Aso said Friday the government would take steps as needed to arrest the yen's ascent.
The next policy meeting outcome will be announced April 28.
In addition to purchasing Japan government bonds (JGBs), the BOJ's massive 80 trillion yen ($712.16 billion) worth of quantitative easing annually already targets Japan real-estate investment trusts (J-REITs) and exchange-traded funds as well as corporate bonds.
But purchases of JGBs may be losing their punch, with the BOJ now owning more than a third of the country's outstanding government bonds.
"[Quantitative easing] is at the end of its limits. All you're doing is building up excess reserves in the banking system," Marvin Barth, global head of foreign-exchange strategy at Barclays, told CNBC's Street Signs Tuesday.