Japan's growth surprise in Q3 | Shanghai Daily

The story appears on

Page B6

November 17, 2009

GET this page in PDF

Free for subscribers

View shopping cart

Related News

Home » Business » Economy

Japan's growth surprise in Q3

JAPAN'S economy flexed more muscle than expected in the third quarter, as rekindled demand at home and abroad fueled its largest expansion in more than two years.

Real gross domestic product grew at an annual pace of 4.8 percent in the July-September period, the government said yesterday, beating even the most bullish predictions. Kyodo news agency had forecast an average annualized increase of 2.6 percent based on its survey of economists.

GDP, or the total value of the nation's goods and services, has climbed for two straight quarters and recorded its fastest acceleration since a 5.7 percent jump in the first quarter of 2007. In the April-June quarter, GDP rose at a revised annual pace of 2.7 percent.

The latest data bolster evidence the world's biggest economies are gaining strength, on track to finish the year in far better shape than they began. The United States and Europe finally shook off recession in the third quarter, and China's growth rate surged to an 8.9 percent pace.

Improving health among its trading partners is critical for Japan's prospects. The world's No. 2 economy relies heavily on exports to drive growth, and the sharp drop in overseas demand last year sent Japan plunging into its worst recession since World War II.

Although Japan appears to have solidly left the recession behind, its future remains murky. Officials were quick to temper their enthusiasm yesterday with warnings of ongoing risks that could undermine the recovery, including falling wages and prices.

Economists already expect an inevitable slowdown in the fourth quarter or early next year as the impact of emergency government spending fades.

"With winter bonuses down sharply and consumer sentiment flagging, we continue to see large downside risks to consumption," said Goldman Sachs economist Chiwoong Lee.

On a quarterly basis, GDP was up 1.2 percent in July-September from the previous three-month period, according to the Cabinet Office's preliminary data.

A 1.6 percent increase in capital spending by companies accounted for a big chunk of that growth. Massive outlays by governments around the world have spurred demand, particularly in China and the rest of Asia. Exports jumped 6.4 percent from the April-June period, the office said.

Domestic stimulus measures and consumer incentives to buy eco-friendly products also helped. Consumer spending, which accounts for about 60 percent of Japan's GDP, rose 0.7 percent from the second quarter.




 

Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.

沪公网安备 31010602000204号

Email this to your friend