Japan central bank steadies rates (AP) (25-01-2011)

TOKYO -- Japan's central bank kept it key interest rate unchanged at zero Tuesday, hoping to protect a still-fragile economy from veering off track.

The Bank of Japan's nine-member policy board voted unanimously at a two-day meeting to keep the overnight call rate target at 0 to 0.1 percent.

According to the central bank, Japan's economy has been pressured by slowing overseas demand, a persistently strong yen and deflation. The employment and income situation remains "severe" and private consumption has fallen recently.

It upgraded its economic outlook for the fiscal year ending March 31, mainly because of a revision of past gross domestic product figures. It now expects real GDP to expand 3.3 percent, up from 2.1 percent forecast in October.

For the fiscal year ending March 2012, the central bank expects GDP to grow 1.6 percent, slightly lower than the 1.8 percent it forecast three months ago.

Source: AP