Japan's cabinet to tap emergency budget reserve
|Japan's cabinet decided on Friday to tap emergency budget reserve worth 549.18113 bln yen on coronavirus responses to back supply chain, farmers and job subsidy, Reuters news has reported.
That leaves 7.28 trillion yen in reserves out of a total 11.5 trillion yen originally earmarked to combat the health crisis.
The spending includes funds for supporting medical facilities, the government said.
"It's because there were many applications. There won't be an expansion of the policy itself," the official told Reuters on condition of anonymity because he was not authorised to speak to the media.
Reuters key notes:
''Through the programme, the government subsidises manufacturers to bring production back and reduce the risks of making goods such as electronics parts or medical equipment only in a select number of countries.''
''The trade ministry said in August it had received 1,670 applications worth about 1.764 trillion yen - about 11 times the remaining amount in the budget for the programme - for a second round of the programme, after ending a first, smaller round in June. It will announce which companies were successful in the second round this month.''
''The government will also allocate funds from the emergency reserve to extend an employment subsidy rolled out in response to the coronavirus pandemic, the official said. The government had decided in August to extend the subsidy from end-September to year-end.''
This follows that last time that the Japanese government approved September's spending of 1.639 trillion yen ($15.51 billion) from emergency budget reserves for coronavirus countermeasures.
There is no market impact on the news, but the stimulus is required to keep risk appetite up.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.