By Takaya Yamaguchi, Tamiyuki Kihara and Leika Kihara<\/p>\n
TOKYO, May 14 (Reuters) – Japan’s government is looking at compiling a supplementary budget to reduce the burden on households from rising fuel bills, two government sources said on \u200cThursday, a move that would put pressure on the country’s strained finances.<\/p>\n
A supplementary budget for the current fiscal \u200cyear would support households that are likely to be hit by elevated gasoline prices and utility bills during the peak-temperature summer season, according to the \u200bsources.<\/p>\n
Prime Minister Sanae Takaichi will make a decision on the extra budget around a Group of Seven leaders’ summit in France in mid-June, said the sources, who declined to be identified as the matter is private.<\/p>\n
The extra budget would come in the form of an additional reserve fund on top of reserves of one trillion yen ($6.34 billion) that are earmarked for the current fiscal \u200cyear through March next year.<\/p>\n
It is not \u2060clear how big the supplementary budget could be.<\/p>\n
After Kyodo news agency first reported the plan, the yield on the 30- and 40-year Japanese government bonds rose as investors braced for increased \u2060debt issuance to fund the extra budget.<\/p>\n
The Ministry of Finance was not immediately available to comment.<\/p>\n
“The fact the government could compile an extra budget was within market expectations,” said Saisuke Sakai, senior economist at Mizuho Research Institute. “The key would be the size. If the \u200bspending is \u200btargeted, it could end up being just several trillions of yen.”<\/p>\n
“If \u200bit turns into a 10-trillion-yen level, markets would \u200cget a different impression and could lead to a spike in long-term yields,” he said.<\/p>\n
Takaichi has repeatedly downplayed the chances of compiling an extra budget with the view that the government has sufficient funds to pay for current fuel subsidies.<\/p>\n
But she has faced growing calls from ruling and opposition lawmakers to come up with a fresh package of plans to cushion the blow from surging oil prices and supply disruptions caused by the U.S.-Israeli war on Iran.<\/p>\n
Japan already curbs gasoline prices through \u200csubsidies. The government is also looking at tapping existing funds to \u200brevive subsidies for electricity and natural gas, a source has told Reuters.<\/p>\n
The \u200badministration’s fiscal expansionary stance has pushed up super-long bond \u200byields by unnerving investors who are already worried that the Bank of Japan may be behind \u200cthe curve in dealing with mounting inflationary pressures \u200bfrom the Iran war.<\/p>\n
An extra budget \u200bwould come on top of a record 122-trillion-yen budget for the fiscal year that began in April, which makes up a core part of Takaichi’s “proactive” fiscal policy.<\/p>\n","protected":false},"excerpt":{"rendered":"By Takaya Yamaguchi, Tamiyuki Kihara and Leika Kihara TOKYO, May 14 (Reuters) – Japan’s government is looking at…\n","protected":false},"author":2,"featured_media":642271,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[28,101,277411,97941,167440,3471,118502,277410],"class_list":["post-642270","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-fuel-bills","tag-gasoline-prices","tag-government-sources","tag-japan","tag-sanae-takaichi","tag-supplementary-budget"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/642270","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=642270"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/642270\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/642271"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=642270"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=642270"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=642270"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}