Japan Ditches Deflation-Fighting Monetary Policies, Says Economy Minister

Economy Minister Minoru Kiuchi stated on Friday that Japan is no longer in a deflationary period, and therefore does not need excessively loose monetary policy to pursue inflation. This contradicts previous reflationist policies introduced under Abenomics, led by former Prime Minister Shinzo Abe in 2013.

Kiuchi added that the government is no longer relying on massive stimulus measures, which were implemented during Abenomics. He emphasized that Prime Minister Sanae Takaichi's policies are different from those of his predecessor.

The comments come after a report showed a government representative calling for caution over further interest rate hikes at the Bank of Japan's (BOJ) September policy meeting. Finance Minister Satsuki Katayama also clarified that Prime Minister Takaichi is not a reflationist, following her conversation with US Treasury Secretary Scott Bessent last week.