Japan has stepped up to fix its struggling economy with an $81 billion stimulus package. Will the influx of money be enough to revive exchange traded funds (ETFs) that track the country’s markets?
Japan’s economy has been walloped lately: the yen has surged to a 14-year high against the U.S. dollar and deflation has taken hold. Prime Minister Yukio Hatoyama has signaled that if bold steps aren’t taken to get the economy back on track, it could return to a recession. (The war Japan is waging).
The stimulus is equal to about 1.5% of Japan’s GDP, reports Hiroko Tabuchi for The New York Times. Japan has been growing for the last two quarters, but consumers in markets to which Japan exports to aren’t going on buying sprees just yet. The strength of the yen has only further exacerbated the situation. (Three signs of growth in Japan).
The package will put $39 billion toward regional growth, $9 billion will go to environmental programs and $6.8 billion will go toward creating jobs. The remaining amount will be used to offer loan guarantees for small companies, reports Jason Simpkins for Money Morning.
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