Article
Japan’s Prime Minister to Unveil Six-Year Economic and Fiscal Plan
Japanese PM Kishida will announce a six-year economic and fiscal plan aimed at boosting growth through labor market reform, domestic investment, and higher productivity. The plan, starting in April 2025, aims for wage growth to surpass inflation, ending deflation. Fiscal policy will follow Japan’s primary budget surplus goal by March 2026.
Japanese Prime Minister Fumio Kishida will announce a new economic and fiscal plan for the next six years aimed at boosting economic growth.
Kishida will instruct the government to discuss details of the new plan when he makes the announcement. The potential plan, which will span six years from April 2025, will aim to boost growth through labour market reform, domestic investment and higher productivity, according to the sources. The measures are expected to ensure that wage growth will be higher than inflation in the next fiscal year and beyond to mark a clear exit from deflation.
That would draw a clear line under nearly two decades of falling prices and economic stagnation that followed the collapse of its “bubble era” boom that stretched from 1986 to 1991.
In a landmark move in March, the BOJ ended eight years of negative interest rates and other remnants of its radical stimulus, as it judged that sustained achievement of its 2% inflation target was in sight. The new plan is likely to include fiscal policy after Japan meets its goal of achieving a primary budget surplus by the fiscal year-end in March 2026.
Source: Reuters