The central government announced a cut in overall spending for the first time in 12 years in its draft fiscal 2024 budget, amid speculation the central bank may soon shift away from more than two decades of ultraeasy monetary policy.

The budget for the coming fiscal year that starts in April is estimated at ¥112.07 trillion ($787 billion), down 2% from the current year's initial amount of ¥114.4 trillion.

Still, the size of the budget hovers above ¥110 trillion for two straight years amid spending pressures on defense outlays to deal with threats from China and North Korea and welfare costs for Japan's fast-aging society.