Japan economic growth modestly improves in Q2, exerts pressure on BoJ for stimulus action
Economic growth in Japan modestly improved during the second quarter of this year, exerting deeper pressure on the Bank of Japan to undertake new policy actions for injecting stimulus into the drowning economy.
Japan’s gross domestic product (GDP) advanced 0.2 percent in the April-June period, up from a preliminary estimate of zero, data released by the Cabinet Office showed in a revised estimate on Thursday. A median estimate of economists forecasted no change from the initial estimate.
Further, compared to the second quarter of 2015, GDP expanded 0.7 percent. An extra leap year day in February helped the economy expand 0.5 percent in the first quarter, which was much higher than market forecasts.
Moreover, corporate capital spending was down 0.1 percent, upwardly revised from the 0.4 percent drop reported in the preliminary data. Consumer spending, the biggest component accounting for around 60 percent of Japan's GDP, remained unchanged at 0.2 percent growth.
Exports shrank 1.5 percent, the same as in the initial report, while imports fell 0.04 percent, slightly upgraded from 0.1 percent. In nominal terms, or unadjusted for price changes, the economy grew 0.3 percent quarter-on-quarter in the three months through June, upgraded from a 0.2 percent increase in the preliminary data.
Meanwhile, investors sold a net of JPY1.3 trillion worth of bonds in the week of September 2. Foreign bond investment totaled USD107.7 billion the previous week. Investors purchased a net of JPY1.9 billion worth of stocks in the same week, following a net sale of JPY15.5 billion, reports confirmed.