On Tuesday, the Bank of Japan changed up its consumer price forecast for the financial year starting in April, a step that shows the effect of recent rises in commodity prices.

The central bank overall has maintained its economic growth forecast for financial years 2011 and 2012, from its projections which were done three months back.

Since the January of 2009 this October for the first the Bank of Japan had downgraded its economic assessment for the nation with uncertain future of world economy as well as the impact of the still appreciated Yen.

Marking its way back to the age of zero interest rates, the Japanese central bank is said to have lowered its standard interest rate to a range of 0% to 0.1%.

This however cannot be termed as a very big change, for, the previous rate too was near about 0.1% but, it surely is a step towards the zero interest rates era.

The continuity of the pace of Japan's economic revival is becoming evident, said the Bank of Japan Governor Masaaki Shirakawa on Wednesday, while addressing a news conference.

Ryuzo Miyao, who is an academic and expert on monetary policy and the new board member of The Bank of Japan, said that as the price was falling and deflation was being expected, the central bank should keep the monetary policy very easy.

Japan's Nikkei average hit its highest close in seven weeks on Friday, with exporters helped by speculation that the yen may weaken if the Bank of Japan takes additional steps to ease monetary policy next week.

The Bank of Japan left its appraisal of the wide domestic economy and the views of economy’s major components unaltered in February. BOJ stated that it is “picking up” since the previous three months.

On Monday, Bank of Japan Governor Masaaki Shirakawa resounded his pledge that the central bank will continue to maintain its very lenient and accommodative monetary stance, in order to keep deflation, which might worsen the economic conditions across the country, at bay.

The Bank of Japan has extended its emergency measures to pump credit into companies for a time span of additional three months as it has downgraded its economic forecast for the current financial year.

Japan's central bank now expects the economy to shrink 3.4% for the fiscal year ending in March 2011 as compared to previous forecast of 3.1%.