Japan Posts 3 Percent GDP Growth
Japan Posts 3 Percent GDP Growth

Japan Posts 3 Percent GDP Growth

Japan Posts 3 Percent GDP Growth

Japan’s economy in the second quarter grew at the fastest pace since 2016, with the rate revised well above the preliminary figure thanks to increased corporate investment in industries like logistics and electronics.
Gross domestic product growth hit an annualized rate of 3% in the April-June quarter, compared with an initial reading of 1.9%, the cabinet office said on Monday. The last time GDP expanded 3% or more was in the January-March quarter of 2016, Nikkei reported.
The revision underlines how a tightening labor market is fueling automation in a rapidly aging country grappling with a labor shortage. But it also comes as the escalating US-China trade war threatens the global economy, posing a risk to investment-driven growth.
Capital expenditure was the driving force, with the figure revised to a 3.1% increase on the quarter, up from 1.3%. Capex during the April-June period grew at the fastest clip in 11 years, according to a finance ministry corporate survey released on Sept. 3. The logistics, chemical and auto parts sectors all saw big jumps in investment.
Japan’s problematic demographics pushed the jobless rate in May to the lowest level in more than 25 years.
Companies are “continuing to increase investment in logistics operations, such as automated distribution centers, because of the labor shortage,” said Junichi Makino, chief economist at SMBC Nikko Securities in Tokyo. “It has been a trend in recent years but was particularly strong in the second quarter.”
In a recent interview with the Nikkei Asian Review, Prime Minister Shinzo Abe said he wants to raise the retirement age beyond 65—potentially giving employers another reason to automate.
Makino noted, however, that the second-quarter jump may have been thanks to large one-off projects, meaning the rate could come down in the third term.
Growth may also be affected by production and supply chain disruptions following a string of natural disasters in recent weeks, including a powerful typhoon that hit western Japan and a large earthquake that struck the northern main island of Hokkaido.
Meanwhile, the trade war looms large, with US President Donald Trump threatening to impose tariffs on more than $500 billion worth of imports from China.
And Japan’s household consumption remains sluggish: The figure grew 0.7% in the second quarter, rebounding from negative territory in the first quarter but still lacking the momentum to drive overall GDP growth.


Short URL : https://goo.gl/hwDGBn
  1. https://goo.gl/ZHn8i5
  • https://goo.gl/qP3yYy
  • https://goo.gl/guR7zP
  • https://goo.gl/6sCGvg
  • https://goo.gl/V8EBDu

You can also read ...

Poland to Maintain Solid Growth
Polish economy’s all significant macro fundamentals appear...
King Khaled International Airport
Saudi Aramco may have grabbed the biggest headlines, but the...
Zimbabwe is in arrears of nearly $1.8 billion  to the World Bank and ADB .
The International Monetary Fund Thursday said it was ready to...
While the tariff conflict may still be in its infancy,  global trade growth rate has almost halved.
The global economy will continue to expand strongly in the...
Wells Fargo Will Cut Workforce
Wells Fargo & Co said on Thursday it would reduce its...
Imran Khan Says Economic Revival a Priority
Pakistan Prime Minister Imran Khan on Thursday said that the...
Global Stocks Hit 6-Month High
World shares hit their highest levels in more than six months...
Premier Li Keqiang has  voiced confidence in China’s ability to overcome obstacles.
Chinese officials are shrugging off warnings that the trade...

Add new comment

Read our comment policy before posting your viewpoints