Discouraged by weak economic growth data, the Bank of Japan (BoJ) on Tuesday refrained from fresh monetary easing measures.

Concluding its two-day policy meeting yesterday, Japan's central bank said it would keep its massive monetary easing programme in place, while tweaking a loan scheme to lenders as part of its efforts to stimulate lending to companies and individuals.

On Monday, fresh economic data revealed that Japan's economy slowed to 0.3 per cent in the October-December quarter of 2013, though it grew 1.6 per cent year-on-year. The weak economy data presented a major challenge for Prime Minister Shinzo Abe, who is struggling to boost the economy by fighting back deflation.

The central bank said in a statement, "Japan's economy has continued to recover moderately, and a front-loaded increase in demand prior to the consumption tax hike has recently been observed."

The rise in sales tax from 5 per cent to 8 per cent is being seen as crucial to bring Japan's national debt down, but the move has also raised concerns that it could derail the government's bid to kick start the country's struggling economy.

Analysts are of the view that the central bank will launch an expansion of its asset-purchasing programme later this year to provide a boost to the economy. The asset-purchasing plan was launched in April last year.