The Bank of Japan (BOJ) kept its massive monetary stimulus program in place on Wednesday as widely expected, but analysts are still penciling in further action in the coming months amid a backdrop of slowing inflation and subpar economic growth.
"The BOJ does not seem to be fully convinced over the strength of the economic recovery," said Marcel Thieliant, Japan economist with Capital Economics, who expects more "preemptive" stimulus coming in late-April.
In an 8-1 vote, the BOJ decided to maintain its pledge to increase base money, or cash and deposits at the central bank, at an annual pace of 80 trillion yen ($671 billion) through purchases of government bonds and risky assets.
"Board members upgraded their assessment of industrial production and exports, which they now see picking up. But they also acknowledged the disappointing fourth quarter GDP (gross domestic product) data released on Monday by noting that the recovery in private consumption has been sluggish in some areas," Thieliant added.
