Japan’s cabinet has approved a record $785 billion budget for the next fiscal year, as Prime Minister Sanae Takaichi seeks to balance economic stimulus with growing concerns over public debt. The spending plan, cleared on Friday, aims to support growth while limiting new government bond issuance, signalling a commitment to fiscal discipline. The move comes amid rising Japanese government bond yields and continued weakness in the yen, which have unsettled investors. Officials said the administration is keen to reassure markets that it will avoid reckless borrowing or unfunded tax cuts. While the budget reflects Takaichi’s proactive fiscal approach, the government stressed that maintaining confidence in Japan’s debt sustainability remains a priority as global financial conditions tighten.
