Japan PM vows to underpin yen by boosting economic competitiveness
EWJ•Prime Minister Sanae Takaichi said boosting Japan’s economic competitiveness would help support confidence in the yen and said she told U.S. President Donald Trump that the currency’s undervaluation was a problem. Budget requests for the next fiscal year total 143 trillion yen ($903 billion), but Takaichi said they would not automatically determine the final budget.
1. Competitiveness and the yen
Takaichi said her administration’s economic policy was not aimed at manipulating exchange rates. She said bold investment in crisis management and growth areas would increase Japan’s supply capacity and global competitiveness, helping ensure market confidence in the yen. She also said U.S. Treasury Secretary Scott Bessent made no specific demands in talks with Japan’s finance minister.
2. Budget priorities
Requests for next fiscal year’s budget total 143 trillion yen ($903 billion), near pandemic-era levels, and could rise further because some items, including defence spending, were requested without specified amounts. Takaichi said the requests would not automatically become the final budget and that the government would set clear priorities, reviewing spending and revenues while monitoring tax revenue.
3. Funding and fiscal policy
Takaichi said spending would be consistent with the goal of steadily lowering Japan’s debt-to-GDP ratio and that the government would appropriately manage bond issuance. She said the government would secure funding to meet fiscal needs, but did not repeat a previous remark that it would aim to cap new bond issuance at 40 trillion yen. The article said concerns about spending plans and funding have weighed on the yen and bond markets.
