Bank of Japan Governor Haruhiko Kuroda said the yen's current weakness was not inflicting severe pain on the economy, toning down an earlier warning to markets against pushing the currency too far down.

He also shrugged off the view held by some market players that the central bank could be dissuaded from expandings its monetary stimulus further because of downside to a weak yen, like the pain households feel from rising import prices.

"At present, I don't think yen declines are causing severe damage to Japan's economy," Kuroda told reporters on Friday.

"There's absolutely no truth to the view that the weak yen will deprive monetary policy of flexibility."

The BOJ board voted 8-1 to stick with the current strategy of increasing base money at an annual pace of 80 trillion yen ($650 billion) through aggressive asset purchases.

It also maintained its rosy assessment of the economy, as it continues to recover. It also said housing investment "appears to be picking up", revising up its view from earlier.

Kuroda reiterated that he expects consumer inflation to hit the BOJ's 2 percent target by around September 2016, a timeframe many analysts believe is too optimistic.

"Job and income conditions have steadily improved and will continue to recover," he said, signaling his conviction that Japan can achieve 2 percent inflation without more easing.

NOT SETTING YEN FLOOR

Japan emerged from last year's recession as capital expenditure rose and consumers spending recovered from the effects of a sales tax hike.

Low oil prices have led many analysts to doubt whether inflation will rise as fast as the BOJ says it will.

Analysts expect the BOJ to ease policy further in October, though some analysts have pushed back their forecasts for more action after the stronger-than-expected first-quarter growth figure.

Some analysts say the BOJ may become more wary of easing dut to concerns that weakening the yen further could draw criticism from lawmakers.

Kuroda sparked a rally by the yen last week when he told parliament that the currency's real, effective exchange rate was already "very low."

Since then the yen has traded in a range of 121-124 yen per dollar - a level that many firms describe as appropriate.

"I have never said, and will never say, anything specific about currency levels or the pace of moves," Kuroda said, replying to a question on whether he tried to prevent the dollar from rising above 125 yen.

The BOJ also decided to reduce the number of its rate reviews from 2016 but issue more frequently a report on its long-term economic projections.