TOKYO, Dec 19 (Reuters) - The Bank of Japan kept monetary policy steady on Thursday and maintained its upbeat assessment of the economy, suggesting that no imminent expansion of stimulus was forthcoming despite lingering overseas risks that weigh on a fragile recovery.
But the central bank offered a slightly more downbeat view on factory output than it did two months ago, saying that it was weakening mainly due to the impact of natural disasters.
As expected, the BOJ maintained its short-term interest rate target at -0.1% and a pledge to guide 10-year government bond yields around 0%, by a 7-2 vote.
At its previous rate review in October, the BOJ said output was moving sideways.
BOJ Governor Haruhiko Kuroda will hold a news conference at 3:30 p.m. (0630 GMT) to explain the decision. (Reporting by Leika Kihara, Daniel Leussink, Tetsushi Kajimoto and Kaori Kaneko; Editing by Chris Gallagher)
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