Economic growth projected at 2.6% for April-June

August 6, 2017

TOKYO- Japan's economy is projected to have expanded at an annualized rate of 2.6 percent during April-June in price-adjusted real terms to mark the sixth straight quarter of expansion, according to the average estimate of 12 private-sector think tanks.

The think tanks believe that the pace of growth in gross domestic product accelerated from 1 percent in January-March on steady domestic demand, including private consumption and corporate capital investment.

They think that consumer spending was driven higher by brisk automobile sales and strong replacement demand for air conditioners.

Corporate capital expenditures are believed to have been pushed up by continued active spending related to labor-saving efforts amid chronic staff shortages.

Construction investment, including expenditures for redevelopment projects in central Tokyo, also increased, according to the think tanks.

Public investment is also projected to have increased after projects included in the government's second supplementary budget for fiscal 2016 started being implemented.

Many of the think tanks estimate that external demand, or net exports, made a negative contribution to the GDP growth for the first time in four quarters, partly due to a slowdown in Asia-bound exports of smartphone parts.Jiji Press