Japan central bank expands asset purchases to spur more corporate investment

The central bank also is designating a similar category of such companies for special support for lending and has extended a special loan support program that largely is aimed at companies hit by the 2011 disasters in northeastern Japan. "They are technical life-prolonging measures" to continue its bond purchase program and set the stage for additional easing. The Nikkei, which ended in the red during the morning, jumped more than 2% in the minutes after the announcement.

The Japanese yen fell to as low as Yen123.

Among the moves, the bank said it would boost its holdings in firms dedicated to capital spending and hiring.

The BoJ wants to take more steps given weakening inflation expectations among firms and a subdued economic recovery, but there is little room left for expanding its quantitative easing, Kugo said.

Easing the monetary policy while claiming it is not reduces the effectiveness of the monetary policy, the BoJ should know better and consequently being punished by today's market reaction. Such a split risks triggering outflows from developing economies and exchange-rate fluctuations.

Global equity markets have fallen sharply amid slumping oil prices, while the USA dollar slipped against the yen on views the Bank of Japan may not ease policy as much as expected. It will also extend the maturity of JGBs it buys to 12 years from 10 years next year.

"This is the type of incremental move that Kuroda previously said he opposes", said BNP Paribas Securities senior economist Hiroshi Shiraishi. As of now, the BoJ already owns roughly half of the market for ETFs in Japan.

"The market is more sensitive to oil than anything else", he said. The Bank of Japan looks to adjust the maturity range in its portfolio to seven to twelve years, from the previous seven to ten years, while holding overall asset purchases to ¥80 trillion annually.

The euro was last up 0.32 percent against the dollar at $1.08600. Australia's S&P/ASX 200 edged 0.1% higher.

Kuroda declined to comment directly on the Fed's policy while noting it reflected a strong USA economy.

Materials and energy shares in Australia were down 1.5% and 0.6%, respectively. So, if not QQE 3, may be QQE 2.1? That weighed on growth in the wider economy.

Prices on US Treasuries rose in choppy trading on rising investor scepticism over the Fed's ability to raise interest rates as much as it would like next year.

Gold prices were up 0.3% at $1,052.90 a troy ounce.