Japan infuses fresh $11 billion stimulus package

Discussion in 'Economics' started by S2007S, Sep 10, 2010.

  1. S2007S


    Just keep in mind how long they have pumping up their economy, another $11 Billion dollar stimulus package to "TACKLE DEFLATION and PROP UP A RECOVERY THREATENED BY THE SURGING YEN".

    Anyone thinking these trillions the US has spent these last 2 years is going to stop anytime soon is foolish, they will keep spending and spending to keep everything from collapsing even if it goes on for another 20 years like japans economy.

    Japan infuses fresh $11 billion stimulus package
    Latest News in Global Markets

    Japan infuses fresh $11 billion stimulus package

    World’s third largest economy Japan on Friday cleared an $11 billion stimulus package to tackle deflation and prop up a recovery threatened by the surging yen, AFP reported.

    Japan's Prime Minister Naoto Kan speaks during a news conference at his official residence in Tokyo

    Japan's Prime Minister Naoto Kan speaks during a news conference at his official residence in Tokyo

    Even as the government put pressure on Japanese central bank to do more, the cabinet of Prime Minister Naoto Kan approved the package that includes initiatives to boost consumption, employment for graduates and investment in green industries besides offering support for small businesses.

    The package, which is expected to boost Japan’s GDP by about 0.3 percent and create around 20,000 jobs, of 915 billion yen or $10.9 billion will be financed by reserve funds.

    The government plans to arrest the volatility of the yen, which has hit a 15-year highs this week against the dollar, including intervening on the issue as it has identified the yen's current strength as "a problem that cannot be unaddressed".

    The government’s tone hardened on taking the yen down ahead of a ruling party leadership election on September 14 where Kan faces a challenge from veteran Ichiro Ozawo, who has been demanding action on the currency.

    Bank of Japan has maintained its key interest rate at 0.1 percent since the financial crisis though it is under increasing pressure from the government to take easing measures on policies.

    Recently, the central bank expanded a multi-billion dollar loan scheme to help the economy combat the impact of a strong yen.

    Japan's gross domestic product grew by an annualised 1.5 percent in the April-June quarter, which is above the initial estimate of 0.4 percent, according to the revised data.

    Japan Prime Minister Kan said the government may take on extra liabilities of as much as one trillion yen outside its budget if economic and employment conditions require further measures.

    He said the government will spend 450 billion yen to boost consumption, including incentives for eco-friendly home appliances, home renovations and low interest home loans, while about 175 billion yen will be spent on job placements for new graduates and creating employment.

    Japan will spend another 120 billion yen to help small- and mid-size companies and to boost low-carbon businesses while 165 billion yen will be invested to strengthen anti-disaster measures in rural areas.