Liberal Democratic Party President Shinzo Abe, who will become prime minister on Dec. 26, and New Komeito leader Natsuo Yamaguchi agreed Tuesday to compile a large-scale supplementary budget for fiscal 2012 as they kicked off talks to form a coalition government.
Abe also met with Bank of Japan Gov. Masaaki Shirakawa earlier in the day and urged the central bank to set an annual inflation target of 2 percent for the consumer price index.
In their chat held a day ahead of a two-day BOJ Policy Board meeting, Abe also told Shirakawa that his incoming government wants to reach a policy accord with the BOJ under which the bank will set the inflation target and keep pursuing monetary easing until achieving it.