Nikkei 225 climbs as Japan averts fiscal cliff

<p>The Nikkei 225 has risen as Japan averts its fiscal cliff by passing a crucial bill.</p>

The Nikkei 225 has made significant gains at close to play today (November 16th), as policymakers have passed a crucial bill ensuring the government does not run out of money at the end of the month – averting a fiscal cliff.

This will allow Japan to borrow more funds by selling bonds to pay for expenses and the approval of the bill comes amid fears the world's third-largest economy is recession-bound.

Japan's economy shrunk by 0.9 per cent in the third quarter of the year compared to the previous month and there are concerns this could worsen in the current quarter.

Earlier, prime minister Yoshihiko Noda dissolved parliament after announcing he would be holding a snap election yesterday. Voters will be invited to the polls next month.

At close of play in Tokyo this morning, the Nikkei 225 was higher by 2.2 per cent to an index value of 9024.1 points – a rise of 194.4 points.

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