Japan Cabinet approves new fiscal stimulus package with spending worth JPY55.7 trillion

The Japanese government announced on Friday that the Cabinet approved a new fiscal stimulus package with spending worth JPY55.7 trillion.

Additional takeaways

“To compile extra budget worth 31.9 trillion yen.”

“Will set aside 5 trillion yen in reserves next fiscal year for emergency spending to combat the COVID-19 pandemic.”

“Will urge oil-producing nations to increase output, work closely with IEA given risk to the economy from rising energy costs.”

“Hope the BOJ continues to work closely with govt, take an appropriate monetary policy with a close eye on pandemic's impact on the economy and market volatility.”

“Will take temporary steps to curb wholesale fuel costs to prevent a spike in retail prices.”

“Will prepare for a resumption of domestic travel discount campaign.”

“Japan spending under stimulus package likely to boost GDP by around 5.6% or 30 trillion yen, with most of the effect appearing in fiscal 2021, 2022.”

Read: Japan PM Kishida: Will employ various means to fund stimulus including issuing new debt

Market reaction

USD/JPY is holding the higher ground on the above news, adding 0.19% on the day. The pair trades at 114.44, as of writing.