TOKYO—Japan’s central bank opted on Thursday not to expand its massive stimulus policies to boost growth, apart from channeling extra support for financing disaster-recovery efforts on the earthquake-stricken southern island of Kyushu.
The Bank of Japan (BOJ) said it would provide up to ¥300 billion ($2.75 billion) in zero-interest rate loans to financial institutions in the disaster-affected areas.
But it left other aspects of its asset-purchases and interest-rate policies intact.
The announcement followed news that factory output rose in March, while core inflation and consumer spending fell, underscoring a lack of confidence among households whose buying power remains the key to sustained growth.
The data had raised expectations that the BOJ might tweak its stimulus efforts to prop up the recovery of the world’s third-largest economy.
Disruptions from twin earthquakes that struck on April 14 and 16 in Kyushu, killing 49 people, accentuated concerns over stalling growth, with some economists forecasting Japan may have returned to recession in the first quarter of the year.
The quakes affected a limited area, but still damaged suppliers to major manufacturers, including Toyota Motor Corp. and Sony. Some communities were devastated, with houses toppled or buried in landslides.
BOJ Governor Haruhiko Kuroda has said he will do whatever it takes to attain an inflation rate of about 2 percent, which the government’s planners say is crucial for spurring growth.