Japan PM says fresh issuance of deficit-financing bonds not an option

TOKYO, June 11 (Reuters) - Japanese Prime Minister Shigeru Ishiba said on Wednesday that issuing more deficit-financing bonds was "not an option the government could take" in light of the country's already stretched finances.

"Given that Japan's fiscal situation remains tight, we must be extremely cautious about issuing more deficit-financing bonds and further deteriorating the state finances," Ishiba told parliament in a debate with the leaders of major opposition parties.

Ishiba made the comments when asked about plans by the ruling coalition to distribute cash handouts, which could add to concerns about the government's fiscal discipline.

Asked about proposals from some opposition parties for reducing the consumption tax rate on food, Ishiba dismissed the idea, arguing that it would take a long time and cost money to prepare. It would also benefit high-income earners more, he said.

"Achieving wage growth is the most effective way to help (households) combat inflation," he said. "We'll overcome rising prices by boosting productivity, reducing costs and achieving wage growth for every worker," he added.