The Takaichi administration has successively issued messages that reflationary policies are unnecessary, with the prime minister and finance minister signaling an intent to dispel the impression that it is cautious about raising rates with the United States in mind.
The Sanae Takaichi administration has uniformly expressed the view that reflationary policies are unnecessary. The prime minister said in a plenary session of the House of Representatives that “this is not a situation requiring reflationary policies,” emphasizing a policy of linking a virtuous economic cycle to expanded employment and income and higher tax revenue.
Finance Minister Satsuki Katayama (片山さつき) and Minister of State for Economic and Fiscal Policy Minoru Jōnai (城内実) also issued statements in succession, aligning their tone in rejecting reflation. The government’s policy indicates an intention to maintain fiscal stimulus and an active fiscal policy.
As market participants’ interest increases, the administration is said to be seeking to dispel the impression that it will proceed cautiously with rate hikes, while signaling consideration for developments in the U.S. market.