A key measure of fiscal health in Japan is losing favor, with allies of the current administration saying that the primary budget balance is all but meaningless in an inflationary environment: the wrong tool for the wrong time.
Critics counter that ignoring the number is just a convenient way to obscure the real problem, and that the downgrading of the key statistic might ultimately damage Japan’s credibility in international markets. Some go as far as to suggest that the quiet campaign to dethrone the statistic is just a way to give Prime Minister Sanae Takaichi room to spend more money.
This debate over an otherwise obscure figure has captivated wonks and political insiders in Japan in recent months, especially as concerns globally increase over Japan’s overall debt burden and how the new prime minister is ideologically inclined to spend.