Japan's fiscal outlook takes dramatic turn as Cabinet Office projects ¥800 billion primary balance deficit for FY2026, reversing previous ¥3.6 trillion surplus forecast. Analysis of Takaichi administration's supplementary budget impact and implications for fiscal health targets.
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.
As the yen plunges to 159 per dollar for the first time in 18 months, Japan's Vice Finance Minister Mimura warns that "all measures are on the table" for currency intervention. Explore the background of the rapid yen depreciation amid dissolution election reports, Japan's intervention history, and what lies ahead for the currency markets.
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.
Japan's Finance Minister Katayama signals strong willingness to intervene in currency markets amid persistent yen depreciation. Despite the Bank of Japan's rate hike in December 2025, the yen continues to weaken to 157-level against the dollar, raising market concerns about potential intervention based on Japan-U.S. joint statement.
In December 2024, Finance Minister Kato expressed strong concern over yen weakness reaching 157 per dollar, warning of "appropriate response to excessive movements" and hinting at potential currency intervention. Analysis of Japan's over ¥15 trillion interventions in 2024, the US-Japan interest rate gap driving yen weakness, and impacts on living costs.