Japan is still growing – enjoying its longest streak of GDP growth for nearly three decades, even though the three months ending December saw a sharp slowdown from the hectic pace in the September quarter.
Japan’s economy has now grown for eight straight quarters, the latest indication that the Bank of Japan and the policies of Prime Minister Shinzo Abe’s government are succeeding in generating more stable growth.
Quarter on quarter growth slowed to an annual rate of 0.5% in the December three months, down sharply from the revised 2.2% pace in the September quarter (2.5% originally in the December announcement).
It was the first estimate for the quarter and these are more often than not revised in subsequent updates, as the September figure was.
Quarter-on-quarter GDP rose just 0.1%, slowing from a 0.3% in the quarter ended September.
Exports, one of the key drivers of the Japanese economy and GDP growth, contributed less to overall growth in the fourth quarter as shipments overseas were offset by a sharp jump in imports (led by higher priced commodities such as oil, LNG, coal and iron ore). Imports were up 2.9%, exports 2.4%.
Private consumption, which accounts for roughly 60% of GDP, was up an annualised 0.5%, (pushing domestic demand up 0.1% and saving the day so far as overall growth was concerned).
That was a big rebound after a 0.6% contraction in the September quarter. Capital expenditure, another big driver of Japanese growth slowed, rising 0.7%, which was under a 1.1% forecast
