Domestic Demand in Japan
Japan - Domestic Demand
Second GDP release leaves growth broadly unchanged in Q1
Although comprehensive data for the first quarter corroborated that the economy expanded for the second consecutive quarter, it also confirmed that the print was mostly led by a sharp drop in imports. According to revised data released by the Cabinet Office on 10 June, GDP rose 2.2% over the previous quarter in seasonally-adjusted annualized terms (SAAR), a stronger expansion than the 2.1% increase initially estimated (Q4: +1.8% SAAR). In annual terms, GDP expanded 0.9% in Q1, accelerating from Q4’s 0.3% increase.
A stronger-than-expected expansion in capital fixed investment (Q1: +2.2% SAAR; previously reported: +0.9% qoq SAAR), mostly due to an upswing in capital expenditure in the non-manufacturing sector, led the mild improvement observed in the second estimate. Dynamics in private consumption and government spending improved only marginally in Q1, while the external sector’s contribution to overall growth was left unchanged at 1.6 percentage points.
Looking forward, Takashi Miwa, an analyst at Nomura, notes that:
“The updated estimates of Jan-Mar GDP seem to indicate that real capex has been holding up well. For that reason, we think GDP statistics are now less likely to be a deciding factor in whether the government chooses to go through with the planned consumption tax hike. However, with US-China trade friction having flared up again since early May, we see little cause for optimism that capex can stay on such a healthy trajectory going forward.”
Japan GDP Forecast
The GDP forecast among BoJ members is between 0.7% and 0.9% for FY 2019 and between 0.8% and 1.1% for FY 2020. FocusEconomics Consensus Forecast panelists see GDP expanding 0.7% in calendar year 2019, which is down 0.1 percentage points from last month’s projection. In 2020, the panel sees the economy growing 0.6%.
Japan - Domestic Demand Data
|Domestic Demand (annual variation in %)||2.4||0.4||0.8||0.0||1.4|
5 years of economic forecasts for more than 30 economic indicators.
|Bond Yield||-0.16||-4.41 %||Jul 31|
|Exchange Rate||108.8||-0.35 %||Jul 31|
|Stock Market||21,522||0.40 %||Jul 31|
Get a sample report showing our regional, country and commodities data and analysis.
Request a Trial
Start working with the reports used by the world’s major financial institutions, multinational enterprises & government agencies now. Click on the button below to get started.
July 31, 2019
At its 30 July meeting, board members at the Bank of Japan (BoJ) decided in a seven-to-two vote to keep its monetary policy unchanged, in line with market analysts’ expectations.
July 31, 2019
Consumer sentiment declined from 38.7 in June to 37.8 in July.
July 30, 2019
Industrial production fell 3.6% on a month-on-month and seasonally-adjusted basis in June, contrasting May’s 2.0% increase and marking the sharpest fall in a year-and-a-half.
July 24, 2019
The Jibun Bank flash manufacturing Purchasing Managers’ Index (PMI) rose from June’s 49.3 (previously reported: 49.5) to 49.6 in July.
Japan: Japan-South Korea trade feud looks set to deteriorate, threatening Japanese tech firms and broader economy
July 22, 2019
Long-standing tensions between Japan and South Korea—originating from colonial-era disputes over forced labor—significantly escalated when Japan applied new restrictions on exports of key materials used in high-tech industries in Korea, effective 4 July.