Japan economic growth seen revised up in Q2: Reuters poll

Published: September 07, 2018 18:10:53 | Updated: September 08, 2018 13:13:39


The economic growth of Japan is expected to be revised up in the second quarter (Q2) due to an acceleration in capital expenditure, a Reuters poll showed on Friday.

The poll of 18 economists also showed that the economy is forecast to have grown an annualised 2.6 per cent in April-June, up from the preliminary 1.9 per cent announced last month.

“I expect an upgrade, which will reflect the fact that capital expenditure is doing extremely well,” said Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute.

The companies of the third-largest economic counytry have been steadily increasing business investment to cope with labour shortages stemming from a shrinking population.

Many company are purchasing new equipment and software that allow them to run factories and provide services with fewer workers, and this spending is making a positive contribution to the GDP.

The Cabinet Office will publish gross domestic product (GDP) data at 8:50 am on Monday, reports Reuters.

Machinery orders, considered a leading indicator of capital expenditure, are forecast to have risen 5.7 per cent in July from the previous month.

That would be a rebound from an 8.8 per cent decline in June and offer further evidence that capital expenditure is gaining strength.

The Cabinet Office will publish machinery orders data at 8:50 am on Thursday Sept. 13 Japan time (2350 GMT on Sept. 12)

Japan’s household spending rebounded modestly in July as higher bonus payments pushed up real wages, data last week showed, in a sign that consumer spending might pick up.

However, economists worry that trade frictions could undermine Japan’s export-oriented economy.

Share if you like