The Cabinet of Prime Minister Yukio Hatoyama adopted on Tuesday a basic policy on compiling the fiscal 2010 budget, including a ¥44 trillion limit on issuing new bonds.
Deputy Prime Minister Naoto Kan said the ¥44 trillion cap underlines the administration's determination to spend aggressively to prop up the economy while preventing long-term interest rates from rising dramatically at the same time.
"Compared with other countries, conditions in Japan, including deflation, are very severe," Kan said.