TOKYO (Reuters – Japan’s record budget at $900billion for the next fiscal years cleared Parliament on Tuesday. Prime Minister FumioKishida’s administration can now seek another spending package in support of households with rising fuel costs and food prices.

Even before passing the budget for the twelve months that began April 1, Kishida came under pressure from both ruling and opposition legislators to put together a stimulus package in order to mitigate the effects of rising household costs due to Ukraine’s crisis.

Takuya Hoshino (senior economist at Dai-ichi Life Research Institute) stated that “targeted spending designed to offset the effect of fuel and food price rises could be beneficial for the economic,” The question now is “How to make sure effective spending.”

The fourth-fastest annual budget approval in postwar history was by Parliament, which approved the government’s fiscal 2022 package of 107.6 trillion Japanese yen ($900 Billion). The huge expenditures required to counter the COVID-19-induced strain on Japan’s third largest economy were not criticized by lawmakers.

It is a rule of the government that any discussion about an additional budget, which would be necessary to finance another spending program, must wait until Japan’s Diet approves it.

Analysts say that now, with parliament having passed the fiscal 2022 budget the government is able to openly discuss the possibility of another spending package.

Kishida indicated last week that government will take additional steps to mitigate rising energy costs, a reference to increasing political demands for a stimulus package.

Toshimitsu, Motegi’s party secretary, indicated that his party needed an additional stimulus just before passing the budget. His party was ready to offer various options to offset the effects of rising prices.

Yuichiro Tamaki, the head of Opposition Party on Friday demanded a new stimulus package for Japan worth 20 trillion Japanese yen. This was based on the assumption Japan is experiencing stagflation.

Hoshino of Dai-ichi Life stated that further spending could be paid for by issuing government bonds. A move which would put a strain on Japan’s already stretched finances.

According to a recent Reuters poll, economic growth in the United States is expected to come to a halt due to supply disruptions caused by coronavirus.

Japan’s massive public debt, which is twice as large as its $5 trillion economy, limits the country’s ability boost fiscal spending in support of the economy.

($1 = 119.6000 yen)