By Lisa Twaronite, MarketWatch TOKYO (MarketWatch) -- The Bank of Japan on Thursday raised its view for the country's economic growth this fiscal year, as Japan caught a tailwind from emerging markets. "Growth prospects will likely be higher for fiscal 2010, mainly due to acceleration of growth in emerging economies," the BOJ said in a statement. It hiked its growth projection for the fiscal year which began in April to 2.6% from its previous estimate of 1.8%. As widely expected, the central bank kept the unsecured overnight call loan rate -- its key policy rate -- at 0.1%, where it has been since December 2008. The policy board's vote was unanimous. The BOJ also maintained its overall economic assessment, saying the country's economy "shows further signs of a moderate recovery." The central bank's policy board releases economic forecasts in April and October, and interim forecast reviews in January and July. Deflating deflation The BOJ also slightly tweaked its price expectations to show more moderate deflation this fiscal year. Its median forecast for the core consumer price index calls for a 0.4% fall, from the previously estimated 0.5% drop. It maintained its median forecast for next fiscal year for a 0.1% decline, and predicted next year's pace of growth will slow to 1.9%, down from the previously expected 2.0% rise.

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