Published: Wed, May 16, 2018
Business | By Kate Woods

Japan's econmin Motegi: Economy recovering moderately

Japan's econmin Motegi: Economy recovering moderately

The economy was hit by stagnant private consumption, fresh data showed.

Economists polled by Reuters suggest Japan's economic growth has decreased by an annualised rate of 0.1% in the first quarter of 2018 after recording 1.6% growth in the final quarter of 2017.

Australia will provide Q1 data for wage prices, which are expected to hold steady at 0.6% on quarter and 2.1% on year.

The yen also strengthened against other major currencies on safe-haven buying, clouding the prospects for Japanese exporters.

"The economy is unlikely to continue to contract further".

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However, a breakdown of the data shows export growth is losing momentum, expanding just 0.6 percent in the first quarter after growth of 2.2 percent October-December past year.

They say the preliminary real GDP fell 0.2 percent from the previous quarter.

The world's third largest economy shrank by 0.6 percent on an annualized basis, a much more severe contraction than the median estimate for an annualized 0.2 percent decline.

"If you look at the Bank of Japan's "Tankan" survey released in April, business confidence was unshaken, with corporate investment plans remaining solid", he said.

Other pundits mentioned special factors that impacted growth in the first quarter.

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

Maruyama of SMBC Nikko Securities.

Officials at the Cabinet Office attribute this to sluggish personal spending.

Nevertheless, wages are finally showing signs of picking up and Minami from Norinchukin said that would feed through into consumer spending in the coming months.

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