Japan's Cabinet Office now projects a ¥800 billion primary balance deficit for FY2026, reversing an earlier ¥3.6 trillion surplus forecast. What the Takaichi administration's ¥18 trillion supplementary budget did to the fiscal-consolidation target, and to interest-rate risk.
In January 2026, Japan's top currency official warned that 'all options' were on the table as the yen hit 159 per dollar. We break down what's driving the slide, Japan's 2022 and 2024 intervention record, the 160 line, and the January BOJ meeting.
In January 2026 the yen slid past 159 to the dollar for the first time in about 18 months, and Vice Finance Minister Jun Mimura said Japan would rule out no measures, a clear hint at intervention. Here is what drove the slide after reports of a snap election, and how Japan has intervened before. Update: a record 11.7 trillion yen of intervention followed in April and May.
Japan's government announced plans to raise visa fees for foreign nationals by approximately five times starting in fiscal year 2026. The move, part of the initial budget approved on December 26, 2025, aims to align fees with Western standards after remaining unchanged since 1978. The policy is expected to generate ¥120 billion in revenue while addressing overtourism concerns and rising administrative costs.
Japan's Ministry of Economy, Trade and Industry allocates approximately 300 billion yen for generative AI in its 2026 budget proposal. Supporting domestic AI development with 1 trillion yen over 5 years in partnership with private companies like SoftBank. Also advancing next-generation nuclear reactor development to strengthen Japan's industrial competitiveness.
In December 2025, Japan's Finance Minister Satsuki Katayama signaled a clear willingness to intervene in currency markets as the yen kept sliding past 157 per dollar despite the Bank of Japan's rate hike. The authorities went on to buy roughly ¥11 trillion worth of yen between late April and late May 2026. Inside the US-Japan joint statement that underpinned the move, and why the yen stayed weak anyway.
In December 2024, Finance Minister Kato warned over the yen at 157 per dollar, pledging an "appropriate response to excessive movements" and hinting at intervention. Japan's ¥15 trillion of 2024 operations, the US-Japan rate gap, and what followed: the 2026 interventions and the first coordinated yen-buying with the U.S. in 28 years.