Japan set aside 388 billion yen to deal with the impact of US tariffs. The yen and Japanese bond yields both fell, prompting attention from the central bank.

According to Bloomberg, citing Japanese Chief Cabinet Secretary Hiroshi Hirasawa, the Japanese Cabinet approved an emergency plan on Tuesday to allocate 388 billion yen (approximately $27 billion) from reserves to assist businesses and households affected by U.S. tariff policies. The report stated that the comprehensive plan aims to support livelihoods and businesses, with 288 billion yen allocated for subsidies for utility bills and 100 billion yen to help local businesses cope with rising costs. This move is intended to alleviate concerns about the impact of U.S. tariff policies on Japanese industries and consumer confidence, with related worries escalating. In addition, it was reported that Bank of Japan Governor Kikuo Iwata and Finance Minister Taro Aso are closely monitoring developments in the bond market. The yen exchange rate and Japanese government bond yields have both declined due to reports of the Ministry of Finance cutting issuance of super-long-term government bonds. Weak demand in the auction of 20-year government bonds had led to an increase in yields previously, but the market now sees this reduction as a government measure to curb rising interest rates, with investor focus shifting to the upcoming auction of 40-year government bonds. Driven by the decline in Japanese government bond yields and depreciation of the yen, the Nikkei 225 index rose by 0.8% on Wednesday, surpassing the 38,000 point mark. The Topix index also rose by 0.6%, reaching 2,786 points, marking a fourth consecutive increase. At the same time, the yen fell below the 144.5 level against the U.S. dollar on Wednesday, declining for the third consecutive trading day as the market digests signals from high-level policy statements and bond market dynamics.