TOKYO: Fumio Kishida, Japanese Prime Minister, is reportedly considering the retention of Finance Minister Shunichi Suzuki in an upcoming cabinet reshuffle, as disclosed by the Kyodo news agency on Tuesday.
This move towards continuity within the finance ministry signifies the administration’s commitment to addressing the sharp depreciation of the yen and formulating a new set of measures to alleviate the impact of rising living expenses.
Kishida is set to execute a cabinet reshuffle on Wednesday to bolster his declining approval ratings. However, indications point to most key cabinet ministers retaining their positions, signaling a continuity of existing economic policies.
In addition to this development, reports from the Yomiuri newspaper indicate that Kishida has chosen to retain Chief Cabinet Secretary Hirokazu Matsuno.
Suzuki, who assumed the role of finance minister in October 2021, played a crucial role in overseeing the government’s intervention to purchase yen last year. He also issued verbal warnings when the yen hit a 10-month low against the dollar.
Japan’s economy is experiencing a delayed recovery from the impacts of the COVID-19 pandemic. However, the growth trajectory is impeded by the rise in fuel and food costs, which has dampened consumer spending.
While a weaker yen can bolster exporters’ profits, it raises costs for imported fuel and raw materials, adversely affecting retailers and households. Notably, inflation exceeded the Bank of Japan’s 2% target for the 16th consecutive month in July.
This development opens the possibility of the central bank gradually phasing out its extensive stimulus program. Still, it also heightens the pressure on the administration to mitigate the financial burden on households.
Kishida announced plans last month to compile a package of economic measures in September, including subsidies to alleviate the costs of gasoline and utility bills.
