Japan has time to restore fiscal health, IMF exec says
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IMF deputy director Nada Choueiri stated that Japan is not at immediate risk of a fiscal crisis due to the long average maturity of its government bonds. However, she urged Japan to use this period to develop a concrete plan for fiscal consolidation as the country transitions to a "new normal" and interest rates rise. Choueiri advised against cutting consumption taxes and emphasized that any fiscal measures should be highly targeted. She noted Japan is overcoming deflation, which is seen positively but will lead to rising long-term interest rates.
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