Japan\'s central bank keeps monetary policy on hold

The Bank of Japan (BOJ) on Friday maintained its monetary policy and kept the key interest rate unchanged at virtually zero, although will extend by six months a special lending program to support ongoing reconstruction initiatives in areas damaged by the March quake and tsunami. The nine members of the BOJ\'s policy board voted unanimously to leave the unsecured overnight call loan rate at between zero and 0. 1 percent to help support the world\'s third-largest economy. This policy rate has remained unchanged for 12-months. In addition the central bank said it will maintain the size of its asset-purchasing program at 652 billion U.S. dollars and extend by six months the availability of special loans to financial institutions in quake and tsunami-hit regions. While some analysts said the BOJ may be looking to take further monetary easing measures to combat a persistently strong yen against the U.S. dollar and the euro, following the single currency region\'s ongoing credit crisis, the BOJ itself on Friday remained noncommittal. \"The bank will continue to carefully examine the outlook for economic activity and prices, and take action in an appropriate manner,\" the BOJ said in an official statement. In addition the central bank raised its assessment of the economy, saying, \"Japan\'s economic activity has continued picking up,\" although did to potential downside risks from overseas economies. \"Overseas economic growth is expected to slow for the time being but will remain firm as a trend, led by emerging economies,\" the BOJ said in a statement issued after the rate decision on Friday.