Japanese Prime Minister Shigeru Ishiba has firmly ruled out cutting taxes by issuing more debt, arguing that Japan’s fiscal position—despite its creditor status—is now “extremely poor, worse than Greece’s.”
Rising Rates and Shrinking Stimulus
Ishiba pointed to the Bank of Japan’s decision to end ultra-easy policy: short-term rates have climbed to 0.5%, and bond-buying tapering threatens to push yields—and debt-servicing costs—even higher.
Debt-to-GDP: A Stark Comparison
With gross government debt exceeding 260% of GDP—the world’s highest ratio after Japan remains a net creditor, much of its sovereign paper held domestically, avoiding Greece-style turmoil.
Election Pressure and Spending Trade-Offs
Facing an upper-house vote in July, Ishiba resisted calls for consumption-tax cuts, noting that rising social-welfare costs already strain revenues.
Track Policy Dates and Market Impact
Market participants can monitor upcoming BOJ policy meetings and key data releases via FMP’s Economics Calendar API, ensuring you stay ahead of rate moves that influence bond yields and the government’s funding curve.
This tighter framework highlights the fiscal dilemma Ishiba faces—juggling political pressures, aging-population costs, and the specter of unsustainable borrowing.
