After another round of negative data showed a sharp fall in industrial production and renewed worries about the health of the Japanese economy, the Bank of Japan cut interest rates.

The Bank's overnight money-market call rate now stands at 0.15%, down from 0.25%. The more symbolic discount rate was also cut, to 0.25% from 0.35%. The rate had already been reduced from 0.50% earlier this month, but a 3.9% slump in industrial production in January sealed fears of a sharp economic slowdown in the country and prompted another move.

Japan's stock market has been battered along with the country's economic health. The

Nikkei 225

touched a 15-year low intra-day.

The latest round of weak economic data and the decline in stock prices are another blow to

Yoshiro Mori

, Japan's prime minister, who is widely expected to resign in the next few weeks. Reports say these troubles are also likely to lead to more pressure on central bank governor

Masaru Hayami

for the Bank's apparent failure to propel both the economy and the market toward a clean bill of health.

The decline in Japan's industrial output, led by the machinery sector, comes amid weakening overseas demand for Japanese goods. The Bank of Japan and the government have said the Japanese economy suffers from the impact of external factors, including the slowing U.S. economy.