Business News

TOKYO, (APP/AFP) – Japan launched an economic
stimulus package worth more than 28 trillion yen ($266 billion) on Wednesday, media reported, days before the central bank is
expected to unveil its own growth-boosting measures.
Prime Minister Shinzo Abe announced the programme in a
speech in southwestern Japan, giving few details except to say
it would include about 13 trillion yen in fiscal measures
including government spending, according to Jiji Press news
agency.
More highlights of the package were expected next week
when the cabinet is due to approve the measures.
Abe promised a stimulus package — which earlier reports
had varied at being worth 10 to 30 trillion yen — after Britain’s
vote last month to quit the European Union sparked a rally in the
yen that threatened profits at Japan Inc.
Traders tend to buy Japan’s currency as a safe bet in times
of turmoil or uncertainty, but it makes the country’s exporters
less competitive overseas and takes a bite out of their bottom
line.
The news comes as speculation mounts that the Bank of
Japan will further ease monetary policy after a two-day meeting
Friday.
Since taking the helm more than three years ago BoJ governor
Haruhiko Kuroda has overseen a massive asset-buying plan that now
stands at an unprecedented 80 trillion yen annually. The scheme
is a cornerstone of Abe’s push to beat years of deflation and
kickstart growth, dubbed Abenomics.
But while Kuroda has insisted the central bank’s target
to reach two-percent inflation is realistic, the BoJ has been
forced to push back its timeline for meeting that goal several
times.
The government and central bank have come under increasing
pressure to do more for the economy as a string of weak readings
and sagging business confidence highlight a long-running weakness.
The dollar jumped as high as 106.54 yen from around 105.01
yen in the morning, after Fuji Television flagged the stimulus
on Wednesday afternoon.
It was sitting at 105.54 yen after the announcement.