World Economic outlook - Japan Economic Growth Q2 Outlook Report 8/13/ 2012 : In July, the Noda administration compiled an economic growth strategy that included a plan for the creation of 9.44 million jobs, including 4.24 million in the energy and medical fields, by 2020.
However, the plan only included goals, such as developing new pharmaceuticals and creating a new market for environment-related products which will be worth 50 trillion yen and create 1.4 million jobs.
Japan Economic Growth in the second quarter slowed to an annualized pace of +2.3% from +4.7% in the first quarter, according to a Bloomberg News survey. This would thus represent quarterly growth of +0.6% rom +1.2%. Growth is likely to slow further in the coming months as the economy moves further away from he devastating natural disasters and ensuing nuclear crisis early last year (the exceptionally strong first quarter reading was in part given the relatively strong March 2012 versus the crisis-impacted March 2011). evertheless, Bank of Japan policymakers have indicated, most recently at their meeting this past week that no new stimulus is warranted as the economy improves.
Accordingly, the big picture is that while growth looks lower, policy makers feel otherwise, and a reading at or above the current forecast of +2.3% year-over-year could further deter speculators from betting on new interventionist policies from the Bank of Japan to weaken the Yen. Given the likelihood of this occurring – as a net importer of energy, the year’s lowest oil prices in the second quarter likely cushioned Japanese growth – we think the Yen’s fundamental posture is increasingly bullish.
A report yesterday showed that machinery orders, an indicator of future capital spending, missed analysts’ forecasts, rising 5.6 percent after falling in May the most in more than a decade.
“It’s unavoidable that Japan’s recovery will lose steam toward the end of the year,” said Hiroaki Muto, a senior economist at Sumitomo Mitsui Asset Management in Tokyo. “The uncertainties over the global economy are increasing and there’s a chance for the yen to strengthen further,” supporting the case for further monetary easing.
Net exports, or shipments less imports, were probably unchanged in the second quarter, failing to contribute to the nation’s 0.6 percent quarter-on-quarter expansion, analysts said in a Bloomberg News survey. Overseas demand added 0.1 percentage point to growth in the first three months of the year, according to a government report.
According to the average forecast of private economists surveyed by the Japan Center for Economic Research, the Japanese economy likely grew an annualized 2.21% in real terms during the April to June 2012 quarter.
The figure, included in the August 2012 edition of the ESP Forecast Survey, was upgraded from the 1.87% growth forecast in July 2012, when the previous survey was conducted.
However, the growth forecast for the July to September 2012 quarter was downgraded to a 1.25% expansion from the 1.52% rise predicted in the previous survey, while the outlook for the October to December 2012 quarter was cut to a 1.08% expansion from the previous 1.21% growth.
The economy is predicted to keep growing moderately at the lower-1% level to mark 4.08% growth in the January to March quarter of 2014, up from the previous forecast for 3.6% growth. Demand at that time is expected to surge ahead of the planned increase in the consumption tax rate.
In fiscal 2012, the economy is seen growing 2.34% on the year, almost the same as the 2.32% growth predicted in the previous survey. The growth forecast was raised slightly for fiscal 2013 to a 1.64% expansion from the previous 1.59%.
A report yesterday showed that machinery orders, an indicator of future capital spending, missed analysts’ forecasts, rising 5.6 percent after falling in May the most in more than a decade.
“It’s unavoidable that Japan’s recovery will lose steam toward the end of the year,” said Hiroaki Muto, a senior economist at Sumitomo Mitsui Asset Management in Tokyo. “The uncertainties over the global economy are increasing and there’s a chance for the yen to strengthen further,” supporting the case for further monetary easing.
Net exports, or shipments less imports, were probably unchanged in the second quarter, failing to contribute to the nation’s 0.6 percent quarter-on-quarter expansion, analysts said in a Bloomberg News survey. Overseas demand added 0.1 percentage point to growth in the first three months of the year, according to a government report.
According to the average forecast of private economists surveyed by the Japan Center for Economic Research, the Japanese economy likely grew an annualized 2.21% in real terms during the April to June 2012 quarter.
The figure, included in the August 2012 edition of the ESP Forecast Survey, was upgraded from the 1.87% growth forecast in July 2012, when the previous survey was conducted.
However, the growth forecast for the July to September 2012 quarter was downgraded to a 1.25% expansion from the 1.52% rise predicted in the previous survey, while the outlook for the October to December 2012 quarter was cut to a 1.08% expansion from the previous 1.21% growth.
The economy is predicted to keep growing moderately at the lower-1% level to mark 4.08% growth in the January to March quarter of 2014, up from the previous forecast for 3.6% growth. Demand at that time is expected to surge ahead of the planned increase in the consumption tax rate.
In fiscal 2012, the economy is seen growing 2.34% on the year, almost the same as the 2.32% growth predicted in the previous survey. The growth forecast was raised slightly for fiscal 2013 to a 1.64% expansion from the previous 1.59%.
No comments:
Post a Comment