IMF official welcomes Japan’s temporary tax cut plan

What happened: A senior IMF official backed Japan's plan to temporarily cut the consumption tax on food to address rising prices, while warning against fiscal deterioration given Japan's exceptionally high debt level. Key numbers: The bill lowers the 8% consumption tax Why it matters: Anand called the approach a very welcome step and said the authorities' plan not to issue additional debt to finance the cut is encouraging. He said support for households should be targeted, temporary and budget-neutral, and that the BOJ is appropriately conducting monetary policy amid high uncertainties.

A senior IMF official backed Japan's plan to temporarily cut the consumption tax on food to address rising prices, while warning against fiscal deterioration given Japan's exceptionally high debt level.

Anand called the approach a very welcome step and said the authorities' plan not to issue additional debt to finance the cut is encouraging. He said support for households should be targeted, temporary and budget-neutral, and that the BOJ is appropriately conducting monetary policy amid high uncertainties.