Japan's central bank keeps key interest rate unchanged at 0.1 percent

Japan's central bank has kept its key interest rate on hold as widely expected but sharply downgraded its economic outlook amid an ever-deepening recession.

In a unanimous vote Thursday, the Bank of Japan's policy board chose to keep the overnight call rate target at 0.1 percent.

The central bank now predicts that the world's second largest economy will shrink a median 1.8 percent this fiscal year through March and will contract 2 percent next fiscal year.

But with rates already super low, the Bank of Japan has little room to maneuver on the interest rate front, despite renewed concerns this week about the health of the global banking sector