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Japan's Suga to order new economic stimulus as early as November, Nikkei says

TOKYO (Reuters) - Japanese Prime Minister Yoshihide Suga will order his government to compile extra economic stimulus measures as early as November, the Nikkei newspaper reported on Tuesday.

FILE PHOTO: Yoshihide Suga speaks during a news conference following his confirmation as Prime Minister of Japan in Tokyo, Japan September 16, 2020. Carl Court/Pool via REUTERS/File Photo

The move would signal the government’s readiness to deploy more support to cushion Japan’s economy from the significant disruption to consumers and businesses by the COVID-19 pandemic.

The measures could focus on supporting tourism and the restaurant industry from declining consumption, the Nikkei said.

There was no change to the government’s willingness to roll out economic measures if conditions required it, the top government spokesman said when asked about potential stimulus.

“As for financial matters, there is 7.8 trillion yen in coronavirus reserve funds remaining. We’ll utilise that balance first,” Chief Cabinet Secretary Katsunobu Kato told reporters at a news conference.

The government may also consider extending a “Go To Travel” initiative to subsidise domestic tourism as part of the stimulus, the Nikkei reported, without saying how it got the information.

Japan has already rolled out $2.2 trillion in fiscal stimulus in response to the health crisis, including cash payouts to households and small business loans that were partly funded via two supplementary budgets.

The government could decide in late December on a draft of a third extra budget to fund the expected measures, when it draws up plans for next fiscal year’s budget, the Nikkei said.

The world’s third-largest economy has started to recover from the impact the coronavirus has had on demand at home and abroad, including the hit to global trade that hurt Japan’s exports of cars and other manufactured products.

The government last Wednesday said economic activity likely stopped contracting in August.

Reporting by Daniel Leussink; Editing by Chang-Ran Kim, Christopher Cushing and Tom Hogue

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