Japan’s economy, which had previously shown contraction, managed to grow in the fourth quarter of last year and avoid recession, according to revised government statistics released on Monday.
Real gross domestic product (GDP) grew at an annualized pace of 0.4% in the October-December period, rather than contracting by 0.4%, according to the Cabinet Office.
Real GDP is a measure of the value of a country’s products and services. The annual rate measures what would happen if the quarterly rate continued for one year.
Japan vows to rebuild “at any cost” 13 years after Fukushima nuclear disaster
This revision reflects improvements in private capital investment. This also means that Japan avoided falling into a tech recession (generally defined as two consecutive quarters of recession).
Illuminated Tokyo Tower (top left) amidst illuminated commercial and residential buildings at night, Thursday, December 8, 2022, in Tokyo. (Photographer: Kiyoshi Ota/Bloomberg via Getty Images)
Growth for the year was flat at 1.9%. Japan’s economy grew by 0.1% in the final quarter of last year compared to the previous quarter.
Ahead of the Bank of Japan’s policy committee, expectations are mixed about what the latest data will mean. Some expect the central bank to start raising interest rates this month or next. Japan has so far maintained a super-easy monetary policy.
The data shows that consumer spending remains weak as wage growth slows, inflation persists in previously deflationary Japan, and the yen continues to weaken against the dollar.
S&P Global Market Intelligence said in an analysis: “These results also highlight the weakness in consumer spending, which reflects a decline in purchasing power. Consumer spending is likely to remain weak.”
CLICK HERE TO GET THE FOX NEWS APP
The GDP revision was expected due to recent data showing strong business investment.
