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Japan: GDP accelerates faster than initially expected in Q1

June 8, 2015

Revised data confirmed that the Japanese economy expanded in Q1 for the second consecutive quarter and showed that growth in the first quarter of 2015 was higher than initially expected. GDP expanded 3.9% in Q1 over the previous quarter in seasonally adjusted annualized terms (SAAR), according to new data released on 8 June. The reading was above the 2.4% increase reported in the first release and represented the fastest pace of growth in one year. On an annual basis, economic activity fell 0.9% in Q1, which was above the 1.4% drop tallied in the first estimate.



The upwardly revised figure showed that investment and to a lesser extent private consumption were stronger than previously estimated, while the contribution to growth from the external sector was left unchanged. Growth in private consumption fared slightly better compared to the initial estimate, expanding 1.5% (previously reported: +1.4% quarter-on-quarter SAAR), while government spending decelerated mildly to 0.3% (previously reported: +0.4% qoq SAAR). Gross fixed capital formation rose 6.4% (previously reported: +0.6% qoq SAAR) and private non-residential investment expanded 11.0% (previously reported: +1.4% qoq SAAR).

The Bank of Japan (BoJ) expects the economy to expand between 1.5% and 2.1% in the fiscal year 2015, which ends in March 2016. In the subsequent fiscal year, the BoJ sees GDP growth of between 1.4% and 1.8%. FocusEconomics Consensus Forecast panelists see GDP expanding 0.9% in calendar year 2015, which is unchanged from last month’s projection. In 2016, the panel sees the economy growing 1.5%.


Author: Ricard Torné, Head of Economic Research

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Japan GDP Q1 2015

Note: Quarter-on-quarter seasonally adjusted annualized changes and annual variation of GDP in %.
Source: Cabinet Office (CO) and FocusEconomics Consensus Forecast.


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