Tag Archives: Japanese growth

The revised figures mean a slight rise in our 2018 growth forecast. However, external uncertainties remain.The second estimate of the Japanese Q2 GDP coming in at 3.0% quarter-over-quarter annualised in Q2, a significant upward revision from the first estimate of 1.9%. This is Japan’s highest growth rate in nine quarters.The biggest revision was in corporate capital expenditure, which rose by 12.8% year over year (y-o-y) in Q2, according to the latest estimate. It contributed 1.7 percentage...

After GDP growth of 1.7% in 2017, we expect the Japanese economy to continue its cyclical recovery in 2018 but momentum is slowing.The second preliminary GDP reading showed that Japanese GDP rose 0.4% over the previous quarter (1.6% annualised) in real terms and 2.0% year-over-year (y-o-y). This latest data release points to Japanese GDP growth of 1.7% in full-year 2017, slightly below our forecast of 1.8%. This still marks the highest annual growth rate for Japan since 2013, and extends the...

Momentum in the Japanese economy remains strong Japanese growth momentum is at its strongest in over a decade, with the quarterly Tankan survey of business conditions and sentiment strengthening to an 11 – year high in Q4 2017. The economy may have expanded by 1.8% in 2017, up from 0.9% in the previous year. In 2018, the growth rate may moderate slightly to 1.3%, but should remain well above Japan’s potential growth,...

Pictet Wealth Management’s view on prospects for Japanese growth, for the yen, and for Japanese bonds and equities.Japanese growth momentum is at its strongest in over a decade, with the quarterly Tankan survey of business conditions and sentiment strengthening to an 11-year high in Q4 2017. The Japanese economy may have expanded by 1.8% in 2017, up from 0.9% in 2016. In 2018, the growth rate may moderate slightly to 1.3%, but should remain well above Japan’s long-term potential. Inflation...

The latest GDP data confirm the economy is expanding steadily. While we have slightly lowered our growth forecast for this year, our 2018 forecast remains unchanged.Japanese GDP for Q3 came in at JPY545.8 trillion annualised, rising 1.4% q-o-q and 1.7% y-o-y in real terms.The data are broadly consistent with our view of a moderate deceleration of the Japanese economy in H2 after a strong Q2. The positive growth in Q3 marks the seventh consecutive quarter of economic expansion in Japan, the...

The growth in retail sales slowed slightly in July, but a strong labour market and the rise in aggregate wages should continue to boost consumer spending.Following a strong rebound in Q2, the momentum behind consumer spending in Japan seems to have moderated somewhat in July. Retail sales in Japan grew by 1.9% y-o-y, down slightly from 2.2% in June and 2.5% in Q2.Despite the softer momentum, the recovery in Japan’s consumer sector, which started roughly in the second half of 2016, may...

The BoJ is keeping its policies unchanged, and there is no change in our scenario regarding its future policy moves.In July’s monetary policy meeting, the Bank of Japan (BoJ) decided to keep its monetary easing programme unchanged, maintaining its qualitative and quantitative easing (QQE) with yield-curve control (YCC). In addition, the BoJ cut its inflation estimates for the current and next fiscal years, and revised its expectation for hitting its 2% target to one year later than the...

Japan presents the paradox of a tight labour market, yet little wage pressure. While there are a number of reasons for this, we still believe wage growth will feed into Japanese inflation figures.The unemployment rate dropped to 2.8% in April 2017, the lowest in more than two decades, with 148 jobs for every 100 job seekers, a level that has not been seen since the early 1970s. What’s puzzling, however, is that the tightness in the labour market appears to have put very little pressure on...

While we are revising up our forecast for GDP growth this year, we expect the Bank of Japan will continue with its qualitative and quantitative easing policies.Japan’s GDP grew by 1.6% year-over-year in Q1 in real terms. On a quarter-over-quarter basis, the economy expanded by 2.2% annualised, the highest growth rate since Q1 2016. In light of the stronger-than-expected Q1 figure, we have decided to revise up our 2017 GDP growth forecast for Japan to 1.3% from 0.8% previously.Exports...

Fourth straight quarter of growth poses upside risk to our Japanese GDP forecast.The first preliminary reading of Japan’s real GDP growth for Q4 2016 came in at 1% q-o-q annualised, roughly in line with the consensus forecast of 1.1% but below the 1.3% growth in Q3. The growth in Q4 almost all came from external demand (+1.0%), while the contribution from domestic demand was virtually 0%. Japanese exports have shown clear signs of improvement in recent months, consistent with the export...