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2026-05-25 17:09:15
[Japan to Prepare 3 Trillion Yen Supplementary Budget, Utilizing Emergency Reserves to Curb Utility Spending] ⑴ Japanese Prime Minister Sanae Takaichi announced on Monday that the Japanese government will prepare a supplementary budget of approximately 3 trillion yen (about US$18.88 billion), raising concerns about fiscal expansion and potentially exacerbating the country's already strained fiscal capacity. ⑵ This supplementary budget is being prepared against the backdrop of the government's decision to use about half of its 1 trillion yen emergency reserves to subsidize projects aimed at curbing utility spending; the need for these reserves is becoming increasingly urgent given the risk of a prolonged Middle East crisis. ⑶ However, Takaichi stated that any additional deficit-covering government bonds that may be issued to finance the supplementary budget are expected to be offset through increased tax revenue and other channels, thereby ensuring that the total amount of government bonds issued in the market on a calendar year basis remains unchanged from the planned level.
