Before local elections next month, Japan plans to provide an additional $15.1 billion to help mitigate the effects of high inflation.
Financial Assistance For Low-Income Families
According to Economy Minister Shigeyuki Goto, the expenditures will come from reserve funds already earmarked for the fiscal year that ends this month. As per the documents from the cabinet office, the measures include financial assistance for low-income families, their children, and home assistants that use liquefied petroleum gas.
Next month, local elections are around the nation, including several by-elections to fill parliamentary seats, which will pit the ruling parties against one another. Because of its unwavering support for Ukraine, Kishida’s government has recently seen a rise in support after hitting a historic low. This week, the Prime Minister visited Kyiv for the first time since Russia’s extensive invasion of Ukraine.
Yet, taking more measures to mitigate the effects of skyrocketing inflation could support public support.
According to Economics Minister Goto, of the recently proposed measures, 500 billion yen will assist low-income people. In comparison, 700 billion yen will be utilized to address the spike in energy prices. The overall sum will exceed 2 trillion yen when combined with other expenditures.
Measures To Control Inflation
Food and energy prices continued to be the most significant contributors to Japan’s core inflation. In January, it reached 4.2%, the highest level since 1981. The announcement of the February statistics on Friday says that the gauge will slow down because prior government price relief efforts have reduced energy rates and kept the price of natural gas in check. Liquefied petroleum gas, used more frequently outside Japan’s major cities, and was excluded from the earlier steps.
According to Bloomberg News, the most recent actions would reduce consumer prices by 0.3% while increasing nominal GDP by 0.09%. The administration had earlier predicted that the current policies would reduce inflation by 1.2%.
In the year beginning in April, the BOJ projects that inflation will drop below its 2% objective. The BOJ says it must continue its monetary easing to keep inflation above the target. To achieve its goal, it also repeatedly emphasized the necessity of wages that could consistently keep up with inflation.
So all the necessary measures will be taken to control the rising inflation in Japan. These measures may affect the country’s impending local elections in some way or another. Overall, inflation will ease in this island country in the coming month.
