Japanese companies raised spending on plant and equipment by 7.1 percent year-on-year in the third quarter of 2019, following a 1.9 percent gain in the previous period. This was the strongest growth in corporate capital spending in over a year, as investment of manufacturing rebounded (7.7 percent vs -1.7 percent in Q2), boosted by petroleum and coal products (5.9 percent vs -48.7 percent), fabricated metal products (2.8 percent vs -1.2 percent), production machinery (18.6 percent vs -3.5 percent), electrical machinery, equipment (5.5 percent vs -9.2 percent), and information & communication electronics equipment (18.9 percent vs -43.4 percent). Also, investment of non-manufacturing companies grew further (7.6 percent vs 7 percent), driven by wholesale & retail trade (17.1 percent vs 7.8 percent), and production ,transmission and distribution of electricity (10.7 percent vs -23 percent). Private Investment in Japan averaged -0.16 percent from 2008 until 2019, reaching an all time high of 12.80 percent in the second quarter of 2018 and a record low of -25.33 percent in the first quarter of 2009. source: Ministry of Finance, Japan
Private Investment in Japan is expected to be 4.50 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Private Investment in Japan to stand at 3.60 in 12 months time. In the long-term, the Japan Capital Spending is projected to trend around 3.40 percent in 2020, according to our econometric models.