Japan April-June Economic Growth Revised Up to 3.0 Pct

September 10, 2018

Tokyo- Japan's gross domestic product grew at an annualized rate of 3.0 pct in April-June from the previous quarter in price-adjusted real terms, faster than an earlier estimated pace of 1.9 pct, the Cabinet Office said in a revised report Monday.

The upward revision from the agency's preliminary report released earlier this month reflects brisk corporate capital spending.

The April-June figure, the first increase in two quarters, was the biggest growth since the 3.4 pct rise in January-March 2016.

The revised figure was higher than a median estimate of 2.6 pct growth in a Jiji Press survey of 19 private economic research institutes.

The latest report showed that real GDP expanded 0.7 pct quarter to quarter, against the preliminary reading of a 0.5 pct increase.

Corporate capital expenditures increased a revised 3.1 pct, much stronger than the preliminary growth of 1.3 pct, mirroring the Ministry of Finance's corporate activity survey released earlier this month.

On the back of the solid global economy, spending on plants and equipment expanded in the electronics industry, such as for semiconductors for smartphones, as well as in the automobile, transportation and other sectors.

The revised data suggest that companies had strong appetites for investment despite concerns over intensifying trade friction between the United States and China, with spending on labor-saving projects becoming active amid labor shortages.

Public investment was revised upward to 0.0 pct from minus 0.1 pct.

The growth of private consumption, which accounts for more half of Japan's GDP, was unchanged at 0.7 pct. Despite the robust Japanese economy, a powerful earthquake that shook northern Osaka Prefecture, western Japan, in June, may have affected consumer sentiment, analysts said.

In nominal terms, Japan's April-June GDP rose 0.7 pct from the preceding three months, for an annualized growth rate of 2.8 pct, higher than the preliminary increase of 0.4 pct and 1.7 pct, respectively. Jiji Press