-Japan's new PM is prepares stimulus package

22/10/2025 15:41

Japan's new Prime Minister Sanae Takaichi is preparing an economic stimulus package that is likely to exceed last year's $92 billion to help households tackle inflation.



The package of more than $92.19 billion marks Takaichi's first major economic initiative since the advocate of big fiscal spending took office on Tuesday, reflecting her commitment to what she calls "responsible proactive fiscal policy."



It will be built around three main pillars: measures to counter inflation, investment in growth industries, and national security.



Japan's Nikkei share gauge erased losses and turned higher on Wednesday afternoon following the report, while the yen pared morning gains and was little changed.



Investors are closely watching her spending plans as Japan is one of the world's most indebted economies.



As part of its core inflation relief measures, the Takaichi administration plans to swiftly abolish the provisional gasoline tax rate.



It also aims to expand local government grants, with a focus on supporting small and medium-sized companies that are unable to benefit from existing tax incentives for wage hikes.