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29 Oct, 2022 12:18

Japan unveils massive spending package

The government wants to tackle inflation and a weak yen
Japan unveils massive spending package

The Japanese government has announced an economic package worth around 39 trillion yen (nearly $270 billion) to support the economy amid rising inflation and a weakening national currency, broadcaster NHK reported on Friday.

The package includes local and central government spending, and is “aimed at overcoming rising prices and reviving the economy… to protect people’s livelihoods and businesses,” Prime Minister Fumio Kishida told reporters in Tokyo.

The government plans to lower utility bills to help households save an equivalent of $19 a month on electricity and $6 a month on gas, according to Kyodo News.

Inflation in Japan has seen its sharpest increase in 40 years, with core consumer prices in Tokyo, a leading indicator of nationwide figures, rising 3.4% in October from a year earlier, according to official figures. The increase has been attributed to rising energy, raw material and food prices amid the economic fallout of the conflict between Russia and Ukraine, as well as other factors, the Kyodo News said.

The Bank of Japan, however, has been swimming against the global current of increasing interest rates as it kept its short-term interest rate at -0.1% on Friday.

Last week, the Japanese yen fell to its weakest level against the dollar since August 1990, having lost more than a fifth of its value against the greenback this year alone.

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