Cabinet approves ¥21.3 trillion stimulus package
The package raises near-term government spending commitments and requires additional government bond issuance to cover funding shortfalls, while the yen is at 10-month lows and super-long government bond yields are at record highs.
Change
Japan's cabinet approved a ¥21.3 trillion economic stimulus package on November 21, 2025.
Why it matters
The cabinet approved the package on November 21, 2025. The stimulus totals ¥21.3 trillion, including ¥17.7 trillion in general account outlays and ¥2.7 trillion in tax cuts. General account outlays exceed the prior year’s ¥13.9 trillion. Funding will use higher-than-expected tax revenues and non-tax income, with any remaining shortfall covered by issuing additional government bonds; the size of that additional issuance has not been finalised but is expected to exceed the ¥6.69 trillion issued for last year’s stimulus.
Implications
- — Increased requirement for additional government bond issuance to fund remaining shortfalls.
- — Larger general account outlays and tax cuts expand near-term fiscal commitments relative to the previous year.
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