Japan: Q3 GDP data worse than initially reported on weaker investment
December 8, 2014
Economic activity fared worse than initially expected, after GDP contracted 1.9% in Q3 over the previous quarter in seasonally adjusted annualized terms (SAAR), according to new data released on 8 December. The reading was below the 1.6% decline reported in the first estimate and marked the second consecutive quarter of contraction, thereby confirming that Japan entered into technical recession. On an annual basis, economic activity fell 1.3% in Q3, which undershot the 0.4% drop tallied in Q2.
The downwardly revised figure showed that domestic demand was weaker than previously estimated, while the contribution from the external sector was left unchanged. Although growth in private consumption kept the previous 1.5% estimate, growth in government spending was weaker, moderating to 1.1% (previously reported: +1.3% quarter-on-quarter SAAR). Gross fixed capital formation declined a sharper 3.5% (previously reported: -2.2% qoq SAAR), while private non-residential investment contracted more than initially reported, falling 1.5% (previously reported: -0.9% qoq SAAR).