The anemic economy is prompting calls for another fiscal boost. If history and the government's strained finances are any guide, a package is likely to redirect cash already on the books.
With ¥1.6 trillion left over from last year and rising tax revenue bolstering the public coffers, the Ministry of Finance has leeway to fund stimulus without adding to the world's heaviest debt load. As much as ¥3.5 trillion is needed to jump start growth, an adviser to Prime Minister Shinzo Abe said after data showed the world's third-biggest economy contracted last quarter.
Economists from SMBC Nikko Securities Inc. to Meiji Yasuda Life Insurance Co. and UBS Group AG see possible measures worth at least ¥2.5 trillion.
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