The Bank of Japan on Tuesday left its ultra-loose monetary policy unchanged, while acknowledging the consumption tax hike introduced this month will have a negative impact on the economy.

During a two-day meeting that ended Tuesday, the nine-member Policy Board unanimously decided to maintain its goal of increasing the monetary base at an annual pace of ¥60 trillion to ¥70 trillion to counter downward pressure on prices, until the next meeting scheduled for April 30.

Economists have expressed concern about a slump in domestic demand after the April 1 consumption tax hike from 5 percent to 8 percent. But for now, board members see the economy as having "continued to recover moderately as a trend," according to a statement released after the meeting.

The members, however, did acknowledge the economy is facing "some fluctuations due to the consumption tax hike."

Views on private consumption and housing investment, key drivers of the economy, were also largely maintained. According to the statement, they "have remained resilient as a trend with improvement in the employment and income situation albeit with some fluctuations due to the consumption tax hike."

The central bank expects the economy to be affected by a drop in consumption following a last-minute surge ahead of the tax hike, but sees a moderate recovery to continue "as a trend."