Japan plans a comprehensive economic package expected to exceed $92 billion to help families deal with rising living costs.
Japan’s newly appointed economic revitalization minister declared that the country’s declining currency brings financial benefits.
The weakening yen has created political challenges for government officials in recent years, as it makes imported goods more expensive and drives up overall inflation. Japan’s inflation rate has stayed above the Bank of Japan’s 2% goal for more than three years.
“We will continue to closely monitor the impact of currency moves on Japan’s economy,” Kiuchi stated. “As for the rising cost of living, we’ll deal with that by compiling a comprehensive economic package,” he added.
Takaichi, known for supporting increased government spending, is putting together an economic aid package that sources have told Reuters will likely top last year’s $92 billion to help families cope with inflation.
Japanese stock prices have surged higher as investors anticipate significant spending from Takaichi, although some experts worry that her plans could stress the country’s already strained finances.
However, the International Monetary Fund cautioned that any government spending should be focused and short-term. “Japan’s economy will go back to potential growth. They don’t need to provide (stimulus),” said Krishna Srinivasan, who heads the IMF’s Asia and Pacific Department, in an interview with Reuters.
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