Japan Q4 GDP Growth Revised Higher to 0.5%

The Japanese economy advanced 0.5 percent quarter-on-quarter in the December quarter 2018, stronger than the preliminary estimate of a 0.3 percent expansion and recovering from a downwardly revised 0.6 percent contraction in the third quarter. The latest GDP reading was above market expectations of a 0.4 percent growth, supported by a rebound in household consumption and an upward revision of business spending following a series of natural disasters.

In the fourth quarter, the largest contribution to GDP growth came from private demand (0.7 percentage points), of which private consumption (0.2 percentage points) and capital expenditure (0.4 percent). In addition, public demand added 0.1 percentage points, while changes in private inventories were neutral. Meantime, net trade had a negative contribution of 0.3 percentage points, as imports (0.5 percentage points) and exports (0.2 percentage points).

Private demand expanded 0.9 percent in the fourth quarter, faster than a 0.7 percent rise in the preliminary estimate and swinging from a 0.5 percent decline in the preceding period. Private consumption went up 0.4 percent, compared to a 0.6 percent incease in the preliminary figure, which was a rebound from a 0.2 percent fall in the prior quarter. Also, capital expenditure grew by 2.7 percent, the stongest pace since the first quarter of 2015, faster than the preliminary 2.4 percent but slightly below market consensus of 2.8 percent. The move followed a 2.6 percent decline in the third quarter. In addition, public demand rose 0.2 percent, down from a preliminary 0.4 percent rise, still rebounding from a 0.3 percent contraction in the preceding quarter, mainly boosted by government spending (0.7 percent vs 0.2 percent in Q3 vs a preliminary 0.8 percent).  

Exports of goods and services expanded 1.0 percent, higher than the preliminary reading of a 0.9 percent gain. The latest figure followed a 1.4 percent drop in the September quarter and marking the steepest growth in a year. Meantime, imports advanced 2.7 percent, unrevised from the preliminary data, after shrinking 0.7 percent in the previous three months and reaching the strongest gain since the September quarter of 2015.

On an annualized basis, the economy grew 1.9 percent, better than the preliminary figure of a 1.4 percent advance, slightly above forecasts of a 1.8 percent expansion and rebounding from a 2.4 percent contraction in the previous quarter.

Japan Q4 GDP Growth Revised Higher to 0.5%

Cabinet Office l Rida Husna | rida@tradingeconomics.com
3/8/2019 10:48:12 AM