Japan’s spending plans to boost yen, says Growth Strategy Minister

Japan’s Growth Strategy Minister Minoru Kiuchi went on Bloomberg Television on August 10, 2026, with a message aimed squarely at nervous currency traders: the government’s spending plans are not as reckless as they look, and the yen will be stronger for them. Markets, for the moment, are unconvinced. The yen has fallen to around 163 per US dollar, levels not visited in nearly four decades, and a massive fiscal blueprint from Prime Minister Sanae Takaichi’s administration has done little to calm those nerves. A spending agenda measured in trillions The scale of Japan’s economic ambitions is genuinely difficult to contextualize. Takaichi’s government has outlined ¥370 trillion, roughly $2.3 trillion, in public-private investments targeted for completion by 2040, spread across 17 priority sectors. The investment push targets areas including defense, artificial intelligence, and semiconductors. The fiscal year 2026 budget alone is projected to exceed 122 trillion yen, or approximately $783 billion, making it one of the largest budgets in Japanese history. Japan’s entire economy produces roughly $4 trillion in output annually. Kiuchi’s pitch is that the fiscal policy is not as expansion...