Japan Economic Outlook
August 27, 2019
The economy surpassed expectations in the second quarter, with consumption benefiting from a 10-day holiday related to the imperial transition and front-loading ahead of the planned increase in the consumption tax in October. Despite soft machinery order readings—a leading indicator for capital expenditure—since the start of the year, investment was extremely robust in Q2. This was likely reflective of efforts by companies to boost productivity in the wake of shortages in the labor market. Real exports, however, contracted for the second quarter in a row amid rising global trade tensions. Looking ahead, the second quarter’s solid reading increases the likelihood that Prime Minister Shinzo Abe will press ahead with the sales tax hike in October, which will likely weigh on private consumption. Cause for concern also stems from exports declining yet again in July amid the escalating trade row between Japan and Korea.Japan Economic Growth
The domestic economy is expected to drive economic growth this year due to a relatively healthy job market, construction works related to the 2020 Tokyo Olympics and solid investment. Subdued global demand, however, is hurting Japan’s all-important external sector. Supplementary public spending should limit the negative spillovers of the October sales tax hike. FocusEconomics panelists see the economy growing 0.9% in 2019, which is up 0.1 percentage points from last month’s forecast, and 0.5% in 2020.Japan Economy Data
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Japan Facts
| Value | Change | Date | |
|---|---|---|---|
| Bond Yield | -0.28 | -4.41 % | Sep 04 |
| Exchange Rate | 106.4 | -0.35 % | Sep 04 |
| Stock Market | 20,649 | 0.40 % | Sep 04 |
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Japan Economic News
Japan: Machinery orders contract in July amid an uncertain global economic outlook
September 12, 2019
Core machinery orders, a leading indicator for capital spending over a three- to six-month period, slipped in July as global trade tensions continue to disrupt investment planning.
Japan: Q2 GDP growth revised downwards on capital expenditure downgrade
September 9, 2019
The downward revision to the GDP figure for Q2 sparked concerns about the future growth trajectory of the country as the economy is grappling with negative spillovers stemming from the China-U.S. trade war and uncertainty regarding the planned sales tax hike in October.
Japan: Industrial production rebounds in July
August 30, 2019
Industrial production rose 1.3% on a month-on-month and seasonally-adjusted basis in July, contrasting June’s 3.3% decrease (previously reported: -3.6% month-on-month).
Japan: Consumer confidence tumbles to over five-year low in August
August 29, 2019
Consumer sentiment declined from 37.8 in July to 37.1 in August.
Japan: Core inflation stabilizes in July
August 23, 2019
The core consumer price index rose 0.1% in month-on-month seasonally-adjusted terms in July, contrasting June’s 0.1% drop. Core inflation was stable at June’s 0.6% in July.
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