Japan GDP revised higher for Q4, economy ducks recession
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Investing.com– Japan avoided a recession in the fourth quarter, a revised gross domestic product reading showed on Monday, aided chiefly by increased company spending on new facilities and equipment.
Revised figures for the October-December quarter showed GDP grew 0.1% quarter-on-quarter, against a prior reading which showed a 0.1% contraction. The prior quarter’s figure was also improved slightly to a fall of 0.7% from 0.8%.
Year-on-year, GDP grew 0.4%, revised up from a contraction of 0.4%, while also improving substantially from a 2.9% slide in the third quarter.
Monday’s reading indicates that the Japanese economy avoided a technical recession in the fourth quarter, with increased capital expenditure helping offset a broad decline in consumer spending.
Export-heavy Japanese companies have benefited largely from a weaker yen, which in turn saw stellar profits through 2023.
Capital expenditure grew 2% q-o-q, much more than the preliminary reading, which showed a contraction of 0.1%. But private consumption remained weak, with Monday’s data showing a contraction of 0.3% in the quarter, worse than an initially estimated 0.2% drop.
Strength in the Japanese economy gives the Bank of Japan more headroom to end its negative interest rates and yield curve control policies. Recent market speculation has the central bank primed to begin tightening its ultra-loose policy by as soon as next week.
