( Financial Times ) -- The Bank of Japan announced further easing measures on Friday , as economic data suggested slowing growth and persistent deflationary forces in the world 's third-largest economy . The BoJ increased the scale of its key asset-purchasing programme by Y5tn ( $ 61.7bn ) to Y70tn , while adjusting the terms to allow it to buy more government debt , and with longer maturities . It also kept interest rates at between zero and 0.1 per cent . Before the announcement market expectations had been building that the BoJ would underline its commitment to the `` powerful monetary easing '' as it was described by governor Masaaki Shirakawa during a trip to the US last week . Politicians within Japan have also been urging the BoJ to do more to fight the nation 's chronic state of mild deflation , threatening to strip the bank of its independence should it fail to act aggressively . Analysts noted , however , that Friday 's move was at the low end of expectations of an additional Y5tn to Y10tn of easing . `` While it is positive that the BoJ acted , it is not sufficient to recover its long-lost credibility as an inflation-fighter , '' said Takuji Okubo , chief Japan economist at Société Générale . Economic data on Friday supported the case for continuing loose policy . Industrial production rose a less-than-expected 1 per cent in March from February , while manufacturers said they planned to cut output by as much as 4.1 per cent in May . While consumer price inflation numbers were a little brighter , with the headline nationwide index rising 0.5 per cent year-on-year , core CPI in Tokyo ( excluding food and energy ) fell by 1 per cent in April from a year earlier , deteriorating from -0.9 per cent in March . This `` chilly set of data '' showed that manufacturers are still cautious on the outlook for exports , leaving Japan reliant on buoyant domestic demand as its main source of growth this year , said Mr Okubo . In February the central bank surprised markets by adding Y10tn to its asset-purchasing programme while adopting a firmer goal for inflation of 1 per cent , touching off a fall in the yen . Since then , though , the BoJ has kept its settings largely unchanged . In March the board expanded the terms of a special lending facility set up in June 2010 , while earlier this month it confirmed details of a new Y1tn lending facility , denominated in US dollars , which it announced in March . Meanwhile , the yen has resumed its strengthening trend . In the past month it has gained against every other G10 currency . One hour after the announcement on Friday the yen was 0.4 per cent weaker at 81.23 against the dollar , while the Nikkei 225 stock average gained 0.3 per cent . `` Not moving [ on Friday ] was not an option , '' said Shogo Fujita , chief Japanese bond strategist at Bank of America Merrill Lynch in Tokyo . © The Financial Times Limited 2012 .
The government increased the scale of its key consumer - purchasing programme by 2010 to Y70tn . Economic data show slowing growth and persistent deflationary forces . Some within Japan have been urging the government to do more to combat mild deflation . Economist : ` ` It is not sufficient to recover its long - lost credibility as an inflation - fighter . ''