The 7-2 central bank decision was to nearly double annual purchases of exchange traded funds, to 6 trillion yen ($57 billion) from the current 3.3 trillion yen.
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The central bank did not change the interest it charges on policy-rate balances it holds for commercial banks, which is now at a record low minus 0.1 percent.
“By leaving the negative interest rate policy unchanged and with no changes to the monetary base, there will be no yield curve pressure and no further pressure on banks”.
ANALYST TAKE: “The fact that the BoJ undershot market expectations should come as no surprise given the lessons learnt from both the Bank of England and European Central Bank meetings this month”, said Joshua Mahony, market analyst at IG.
The dollar fell more than a full yen on Friday at one point to as low as 102.825 and the Nikkei average tumbled almost 2 percent, after the BOJ’s decision fell short of expectations.
Japan’s Nikkei 225 closed 0.6 percent up at 16,569.27, regaining earlier losses.
The dollar weakened 1.9 percent to 103.27 yen, its biggest one-day decline since June 24, after the U.K.’s decision to leave the European Union.
“It was the most moderate approach investors had expected”, said Minori Uchida, head of Tokyo global markets research at Bank of Tokyo-Mitsubishi UFJ.
MSCI’s broadest index of Asia-Pacific shares outside Japan pulled back 0.4 percent after hitting the highest level since August 11, leaving it on track for gains of 0.9 percent for the week, and 5.4 percent for the month.
Wall Street shares remained near all-time highs, with tech heavyweights Alphabet and Amazon rising after the bell as their earnings beat expectations. China’s Shanghai Composite Index slipped 0.5 percent to 2,979.34 and South Korea’s Kospi slid 0.2 percent to 2,016.19. It fell 78 cents to close at $41.14 a barrel on Thursday. The euro rose to $1.1084 from $1.1081 from the previous day. The Dow Jones industrial average lost 15.82 points, or 0.1 percent, to 18,456.35. USA futures augured a lower opening on Wall Street, with the Dow futures down 0.2 percent and S&P futures also 0.2 percent lower. Australia’s S&P ASX 200 rose 0.1 percent to 5,560.40. Brent crude, used to price global oils, gained 4 cents to $43.27 in London. It is down 6.7 percent this week and 14 percent this month.
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The U.S. dollar slumped versus major rivals Friday, weakening in the wake of weaker-than-expected second-quarter gross domestic product data, while the yen rallied after the Bank of Japan delivered a smaller-than-expected round of additional stimulus.
