Updated: 04/30/2014 14:33 | By Agence France-Presse

BoJ cuts growth forecast, holds fire on easing

Bank of Japan policymakers on Wednesday lowered their expectations for the economy with fiscal year growth slated to come in at 1.1 percent, down from an earlier 1.4 percent forecast.


BoJ cuts growth forecast, holds fire on easing

A woman shops at the Itoyokado supermarket in Tokyo on April 1, 2014, the day a sales tax rise came into effect - by Yoshikazu Tsuno

The bank's semi-annual report, which gauges the median of BoJ members' views, also expected core inflation for the year to March to be 1.3 percent, matching an earlier forecast.

The revision came as the central bank held fire on expanding its stimulus programme despite tepid industrial production data and a recent sales tax rise that have fanned fears over the strength of the country's recovery.

In a brief statement, policymakers said the decision was unanimous after wrapping up a one-day meeting, with markets now looking to comments from BoJ Governor Haruhiko Kuroda at 3:30 pm local time (0630 GMT).

The central bank is also set to release its semi-annual report on economic growth and prices, which will be seen as a key measure of whether the BoJ still thinks it can reach a 2.0 percent inflation rate target by next year.

Kuroda has stuck to the ambitious timeline despite growing doubts among analysts, with many saying the BoJ would be forced to further expand its monetary easing measures.

The BoJ's price target-- and the massive easing campaign launched last year -- are a cornerstone of Prime Minister Shinzo Abe's bid to breathe new life into the world's number three economy after years of deflation and tepid growth.

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