The Bank of Japan is leaving its key interest rate unchanged at 0.5% amid concern about recent financial market volatility and persistent deflation. The bank gave no explanation for the decision, which was made in an 8-1 vote.
No change had been expected given jitters about the fall-out from US mortgage and credit market turmoil.
Although global stock markets have rallied since the Federal Reserve slashed its main interest rate last month, the BoJ was expected to wait longer before hiking its rates due to lingering deflation and only moderate economic growth.
Analysts still see a possibility of another interest rate hike before the end of the year, although some argue the central bank should wait until next year.
Concern about the health of the Japanese economy has increased since the government said last month that gross domestic product contracted in the second quarter due to a fall in corporate capital spending.
Inflationary pressures also remain virtually non-existent, with the core consumer price index down 0.1% in August from a year earlier.
