• Sun. Apr 21st, 2024

Japan’s Economy Avoids Recession as Quarterly Growth Data is Revised Up

BySamantha Johnson

Mar 11, 2024
Japan’s Economy Avoids Recession as Quarterly Growth Data is Revised Up

Japan’s economy expanded at an annualized rate of 0.4% in the October to December quarter, which was better than the initial estimate of a 0.4% contraction. This data, released by the government, exceeded economists’ expectations for a 1.1% increase. This growth allowed Japan, now the world’s fourth-largest economy, to avoid a technical recession due to stronger-than-expected spending by companies on plants and equipment.

GDP in Japan grew by 0.1% on a quarter-on-quarter basis, compared to the initial estimate of a 0.1% drop. Capital expenditure also increased by 2.0% quarter-on-quarter, surpassing the government’s preliminary estimate of a 0.1% decrease. However, this growth was slightly below the median market forecast of a 2.5% rise.

The revision of Japan’s GDP comes at a time when there are expectations in the market that the Bank of Japan may abandon negative interest rates as early as this month. This speculation has been fueled by recent hawkish comments from board members indicating that Japan is moving closer to the central bank’s 2% inflation target. The Bank of Japan is set to hold a policy-setting meeting on March 18 and 19.

Despite the overall growth, private consumption, which accounts for about 60% of Japan’s economy, fell by 0.3% in the October to December period, slightly worse than the initial estimate of a 0.2% decrease. In January, inflation-adjusted real wages in Japan decreased for the 22nd consecutive month, and household spending saw the largest drop in 35 months.

External demand contributed 0.2 percentage points to real GDP, remaining unchanged from the preliminary reading.

By Samantha Johnson

As a content writer at newszkz.com, I delve into the realms of storytelling, blending words to paint vivid narratives that captivate and inform our readers. With a keen eye for detail and a passion for research, I craft compelling articles that resonate with our audience. My love for words drives me to explore diverse topics, ensuring that each piece I create not only educates but also entertains. Join me on this journey as we navigate the ever-evolving landscapes of news and knowledge together.

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