Japan Economic Outlook
September 25, 2018A more complete GDP estimate showed that the economy rebounded in Q2 at a stronger pace than previously reported on the back of surging investment, especially in the non-residential sector. Strong corporate earnings and still positive business sentiment are propelling investment growth. However, despite accelerating in Q2, private consumption remains weak as a tight labor market has not yet translated into a boost to workers’ paychecks. Exports, meanwhile, continued to post positive figures in August, mostly due to solid shipments to China. That said, the contribution to overall growth will likely diminish in Q3 as rising oil prices pile pressure on the trade balance, which swung to a deficit in July and August. In the political arena, Prime Minister Shinzo Abe was reelected leader of the ruling Liberal Democratic Party (LDP) by a landslide on 20 September. Now on course to become Japan’s longest-serving leader, his victory may embolden him to revise the country’s pacifist constitution.
Japan Economic GrowthEconomic growth will remain broadly stable next year mostly propelled by solid domestic demand. An ever-tighter labor market is expected to fuel wage growth, while industrial upgrades and the 2020 Tokyo Olympics will bolster investment. Risks mostly stem from rising trade protectionism, slow global economic growth and the effects of a planned sales tax hike in October 2019. Met the why particular panelists see the economy growing 1.0% in 2018 and 1.1% in 2019, which is up 0.1 percentage points from last month’s forecast.
Japan Economy Data
5 years of Japan economic forecasts for more than 30 economic indicators.
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|Bond Yield||0.15||-4.41 %||Oct 18|
|Exchange Rate||112.2||-0.35 %||Oct 18|
|Stock Market||22,658||0.11 %||Oct 18|
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Japan Economic News
October 19, 2018
The core consumer price index rose 0.1% in month-on-month seasonally-adjusted terms in September, below August’s 0.3% increase. Core inflation inched up from 0.9% in August to 1.0% in September, exceeding market expectations of a 0.9% rise.
October 18, 2018
Nominal yen-denominated merchandise exports fell 1.2% annually in September, contrasting the 6.6% increase logged in August and missing market expectations of a 2.1% increase.
October 11, 2018
Core machinery orders, a leading indicator for capital spending over a three- to six-month period, expanded for the second consecutive month in August, suggesting that capital expenditure will boost overall economic growth further down the road.
October 2, 2018
The Nikkei flash manufacturing Purchasing Managers’ Index (PMI) came in at 52.5 in September, unchanged from August’s print.
October 2, 2018
Consumer sentiment increased from 43.3 in August to 43.4 in September.