ibusinesslines.com
ibusinesslines.com July 23, 2018


Japan's econmin Motegi: Economy recovering moderately

16 May 2018, 09:30 | Kelvin Horton

Top News: Japan's economic system shrinks in January-March quarter

GDP marks first contraction in 9 quarters

"There were one-off special factors in the January-March period, ranging from stock market sell-offs to higher vegetable prices due to bad weather", said Takeshi Minami, chief economist at Norinchukin.

Japan's Economy Minister Toshimitsu Motegi said on Wednesday there was no change to the government's view that the economy was recovering moderately.

The Japanese economy contracted for the first time in two years in the first quarter of 2018.

"Globally, IT-related items have been in an adjustment phase, which weighed down Japan's exports and factory output", said Yoshimasa Maruyama, chief market economist at SMBC Nikko Securities.

Economists polled by Reuters last week had expected a contraction of 0.2%.

Given Japan's reliance on export-led growth, trade friction brought on by President Donald Trump's efforts to trim the perennial US trade deficit has raised uncertainty over the outlook for the economy.


Exports rose 0.6 percent.

Japanese government officials expect the decline to be temporary.

The surprise quarterly decline saw the seasonally-adjusted annual rate decline to -0.6%, below the -0.2% level forecast by economists.

Consumer spending fell marginally, registering a decline of less than one percentage point in the first quarter. But with wage increases lagging inflation, consumer spending has remained flat, the latest data showed.

The poor first quarter snapped a string of eight straight quarters of expansion for the Japanese economy, which had marked the longest such streak in more than three years.

"The revised GDP data 2017 showed the economy had already started to slow down from the beginning of past year".



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