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Story summary
- The International Monetary Fund advised Japan not to cut its consumption tax and warned such a move could worsen fiscal risks amid higher borrowing costs.
- Prime Minister Sanae Takaichi plans to debate suspending the food sales tax, but the IMF cautions against loosening fiscal policy as debt servicing doubles by 2031.
- The IMF forecasts the Bank of Japan will raise interest rates twice this year and once in 2027.
