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BoJ stands pat on easing, says economy 'recovering moderately'

Update: December, 20/2013 - 11:30

TOKYO – The Bank of Japan on Friday held off announcing any fresh measures to stimulate the economy, offering the upbeat view that it was "recovering moderately" while efforts to stoke inflation were taking hold.

The decision comes despite a sharp slowdown in July-September growth that raised concerns about the strength of recovery in the world's third-largest economy and fuelled speculation that the BoJ will expand its asset-purchasing scheme.

"Japan's economy has been recovering moderately," the BoJ said in a statement, adding that "inflation expectations appear to be rising on the whole."

"The year-on-year rate of increase in the CPI (consumer price index) is likely to rise for the time being."

The bank's meeting comes several days after its closely watched Tankan quarterly survey showed business confidence has soared to a six-year high, underscoring growing optimism among Japanese firms.

The BoJ unveiled its vast asset-buying scheme in April as part of a broader plan by Prime Minister Shinzo Abe to reinvigorate the economy and eradicate deflation with a policy blitz.

Reversing years of falling prices is a key goal of the BoJ's plan, which aims for 2.0 per cent inflation in two years, although analysts are growing increasingly sceptical of that ambitious timeline.—AFP

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