What we learned from Takaichi’s stimulus package

The Takaichi government unveiled the largest stimulus package of the post-Covid era on Friday, 21 November.
The government signaled that political leadership will guide fiscal policy, though Prime Minister Takaichi Sanae, despite her dovish inclinations, is still trying to reassure markets that her government will pursue “responsible” fiscal expansion.
The process of drafting the FY2025 stimulus package and supplemental budget will likely serve as a preview for the government’s approach to the FY2026 general budget, as the government will not only seek to include Takaichi’s own priorities but will work with ruling and opposition parties to ensure their preferences are incorporated into the final draft.