Japan's aged finance minister is to quit due to poor health after weeks of exhausting wrangling over the budget, the Nikkei news agency said on Tuesday, a fresh blow for Prime Minister Yukio Hatoyama as he struggles with a frail economy and huge public debt. Hatoyama had said he wanted Hirohisa Fujii to stay on, but if he does go it could put the fiscal restraint championed by the 77-year-old lawmaker at risk and weigh on government bonds, though for now investors are reassured that bond issuance for the fiscal year from April is set.

Finding a successor for Fujii from within the inexperienced ranks of his party will be another test for Hatoyama ahead of a mid-year upper house election that will weaken the DPJ's ability to pass legislation if it loses.