Japan: Q4 growth revised down amid weaker consumption and investment
March 11, 2011
The economy contracted more than initially reported in the fourth quarter. According to the second preliminary estimate released by the Cabinet Office on 10 March, GDP dropped by 1.3% at a seasonally adjusted annualised rate over the previous quarter, below the 1.1% contraction estimated earlier and also lower than market expectations of a 1.2% decline. Private consumption and investment were the main factors behind the downward revision of fourth quarter numbers. Private consumption dropped an annualised 3.2%, after having been initially estimated to have declined by 2.9%, while gross fixed capital formation dropped 1.6% (previous estimate: -2.6% qoq saar). Exports and imports remained broadly in line with the previous reading. On a quarter-on-quarter basis, GDP grew 0.3%, which was unchanged from the previous estimate. Despite the downward revision, full-year growth for 2010 reached a robust 3.9%, which marked the fastest pace since 1990.