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Japan planning new economic package in October after near-term help


By Daniel Leussink and Kantaro Komiya

TOKYO (Reuters) -Japanese Prime Minister Fumio Kishida said the government will present another economic package in October, which would add to a slew of measures to deal with the pain from the rising cost of living to be unveiled on Friday.

The government will consider compiling a supplementary budget “at an appropriate timing” to finance the package due in October, Kishida said.

For the time being, the government will tap 3.5 trillion yen ($24.30 billion) in emergency reserves in late September to fund steps to cushion the economic blow from rising food and energy price, Kishida said.

“Rising prices such as in food and energy are having a major impact on consumers’ lives and the management of businesses. We’ll take seamless measures with a sense of urgency,” Kishida told reporters on Thursday.

The move by the government to provide extra support shows Kishida’s resolve to try to limit the fallout the world’s third-largest economy is seeing from higher prices of fuel, energy and commodities globally.

Helping consumers withstand the pain they face from global price rises that are pushing up the cost of living has become one of Kishida’s policy priorities to boost the country’s economic recovery and win back support for his cabinet.

Talk of a supplementary budget, rather than relying again on emergency reserves, suggests October’s package could be more sizeable than the immediate help.

A government panel will outline on Friday near-term steps such as offering 50,000 yen ($345) in financial support to households that are exempt from paying resident taxes.

The government will also extend a freeze on the price of imported wheat the government sells to retailers beyond October — a move that essentially makes it easier for households to cope with higher commodity prices.

A poll this week showed disapproval of Kishida’s cabinet jumped a sharp 7 percentage points to 41%, climbing over 40% for the first time since he took office last year. Other surveys have shown disapproval edging above approval.

($1 = 144.0600 yen)

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