In the third quarter, GDP declined 3.5% over the previous quarter in seasonally adjusted annualised terms (saar). The print contrasted the 0.3% rise tallied in the previous quarter and represented, in fact, the sharpest fall recorded since Q1 2011. That said, the result was broadly in line with market expectations that had GDP falling 3.4%. On an annual basis, economic activity expanded a paltry 0.1% in the third quarter (Q2 2012: +3.3% year-on-year). The domestic side of the economy deteriorated markedly amid a sharp decline in both total consumption and investment. Private consumption declined 1.9% in the third quarter (Q2: -0.4% quarter-on-quarter saar), whereas public spending expanded 1.4% (Q2: +1.9% qoq saar). On the other hand, private non-residential investment plummeted 12.1% (Q2: +3.8% qoq saar), suffering the steepest fall since Q2 2009. The external sector also deteriorated in the third quarter. Exports of goods and services contracted a whopping 18.7% over the previous quarter in annualised terms (Q2: +5.3% qoq saar) amid falling shipments to China due to the territorial dispute regarding the Senkaku/Diaoyu islands. Meanwhile, imports declined 1.4% (Q2: +7.3% qoq saar) partially due to lower fuel purchases. As a result, the external sector's annualised net contribution to overall growth plunged from minus 0.2 percentage points in the second quarter to minus 2.9 percentage points in the third.
GDP contracts sharply in Q3
November 12, 2012
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Japan GDP Chart
Note: Quarter-on-quarter seasonally adjusted annualized changes and annual variation of GDP in %.
Source: Cabinet Office (CO) and FocusEconomics Consensus Forecast.
Japan Economic News
October 12, 2016
Core machinery orders (a leading indicator of capital spending over a three- to six-month period) declined for the first time in three months in August.
October 4, 2016
Consumer sentiment rose from August’s 42.0 to 43.0 in September.
October 3, 2016
According to the Bank of Japan’s quarterly TANKAN business survey, sentiment among large manufacturers was stable at 6 in Q3.
September 30, 2016
In August, industrial production expanded 1.5% over the previous month in seasonally-adjusted terms, which contrasted July’s 0.4% decrease (previously reported: 0.0% month-on-month).
September 30, 2016
In August, the core consumer price index was flat compared to the previous month, which was above the 0.2% decline in July.