The Bank of Japan (BOJ) left monetary policy steady.
The central bank maintained its negative 0.1 percent deposit rate and its 80 trillion yen base money target. However, it did leave the door open to additional easing steps and said it will provide loans at zero interest rates to areas impacted by the recent Kyushu earthquakes.
At its meeting, the BOJ lowered its gross domestic product growth (GDP) forecast to 1.2 percent growth for the 2016-2017 fiscal year, from a previous estimate in January of a 1.5 percent expansion.
BOJ Governor Haruhiko Kuroda told reporters at a press conference following the decision that the central bank remained committed to achieving its 2 percent inflation target in about two years.
But he ruled out the possibility of the BOJ directly financing the government, a policy also known as "helicopter money," Reuters reported. Such a move would be illegal under Japan's current legal system, he said.