The Bank of Japan announced on Tuesday its most determined effort yet to end years of economic stagnation saying it would switch to an open-ended commitment to buying assets next year and double its inflation target to 2%. It promised to reach the inflation goal "at the earliest possible time."
The steps represent the latest unorthodox effort by a leading central bank to support a weak recovery from the global financial crisis, although in Japan's case the country is also trying to overcome nearly two decades of low-grade deflation.
The announcement follows weeks of pressure from Prime Minister Shinzo Abe for a greater push to lift an economy out of recession. Consumer price inflation has reached 2% in only a handful of months since late 1990s.
"This is very good news. The BOJ has been more aggressive than the market expected," said Brian Redican , senior economist at Macquarie in Sydney.
The central bank said that from 2014 it would switch to an open-ended approach of buying a certain amount of assets - 13 trillion yen ($144.77 billion) - each month without setting a deadline for completing the purchases.