"All regions reported that the economy had continued to recover, or had been recovering moderately as a trend, while the subsequent decline in demand following the front-loaded increase prior to the tax hike had been observed," the central bank's report said.

"Domestic demand had been firm, production had been on a moderate increasing trend, and the employment and income situation had been improving," the report added.

The bank said that the robust reports are evidence that the economy is back on track and likely to hit the bank's price target without the need for rolling out further stimulus measures.

BOJ governor Haruhiko Kuroda told a meeting of the BOJ's regional branch managers on Monday that the bank was not considering deviating from its ultra-loose policy and reiterated the bank's intention to hit its 2 percent inflation target in two years by maintaining the huge stimulus program for "as long as necessary."

"The BOJ's ultra-loose monetary policy has been exerting its intended effects," Kuroda said. "The central bank will examine both upside and downside risks to economic activity and prices, and make adjustments as appropriate," the BOJ chief said.

Four of the nine regions assessed in the quarterly survey raised their assessment on capital expenditure to say it was " picking up" or "increasing further," as the effects of Prime Minister Shinzo Abe's initial round of economic policies and strategies begin to take hold, with those, in turn, expected to be underpinned by the government's latest structural overhaul plans for the economy, unveiled recently.

Abe's Cabinet, on June 24, endorsed the government's new package of economic reforms aimed at boosting the earning power of corporations, deregulating deflation-hampered sectors and implementing structural changes to address the nation's shrinking population.

The long-awaited third arrow of the prime minister's strategy for economic revitalization policies will see a government push for deregulation in the agricultural and medical sectors, as well as in areas concerning healthcare and employment -- long thought of as being sectors overly contributing to decades of deflationary pressure on the economy.

In addition, the expansive package also calls for a lowering of Japan's comparatively high corporate tax rate from 35 percent to below 30 percent, in a bid to attract more foreign direct investment, effective within a few years from fiscal 2015, and special economic zones with favorable tax incentives to be launched in autumn this year.

Reforms to Japan's labor force will allow for more flexible working schedules, attract more women to the workplace and increase the ratio of male-to-female executives, as well as allowing more foreigners to work in domestic and healthcare facilities, to further encourage more women to enter or return to the workforce, in a bid not just to increase corporate productivity, but also address the burning issues of Japan' shrinking and aging population.

The government also said it will provide more day care facilities for working mothers, as well as tax incentives to further encourage the augmentation of the female workforce, under a widely publicized reform policy dubbed "Womenomics."

A substantial increase in the government's budget has also been earmarked for the government's long-term goals to tackle the nation's slumping birthrate and maintain the nation's population level at around 100 million after 50 years.

The government's longer-term policy initiatives also outline details to revamp the healthcare sector, by offering patients more expansive and bespoke treatment options, catering to both insured and uninsured patents.

"Big businesses upping their capital expenditure is a sign that the government's strategies are taking effect," Toru Umemori, head of the BOJ's branch in Nagoya of the Tokai central Japan region, was quoted as saying.

"Companies that have seen increased revenues are using the surplus to increase their capital expenditure and more firms are ramping up their spending and it would seem that this trend is broadening," Umemori told a press briefing Friday, underscoring the government's recent push to boost the earning power of corporations.

Nine regions all maintained their view from three months ago that household spending was picking up or recovering moderately despite the impact of the tax hike and, regarding consumption, the report stated that, "Consumer spending is likely to stay firm as a trend with the effect of the tax hike seen subsiding around the summer, as wage and income conditions improve."

Five of the nine regional economies surveyed registered consumption charting an upward trajectory, with the remaining four saying that some resilience remained.

The majority of regions noted that retail sales had been picking up, particularly regarding consumer durable goods such as cars and appliances, following a lull after the April tax hike.

Monday's report will be keenly-eyed by the central bank's policy board at its upcoming meeting pegged for next week, at which the nation's long-term growth prospects will be traversed, although monetary policy is likely to remain unchanged.