Reuters Poll Expects Weaker Japan GDP

Japan’s economy is expected to have barely grown in the first quarter, a Reuters poll showed on Monday, as stagnant consumer spending and wobbly financial markets keep expectations for more government stimulus measures alive.

Gross domestic product (GDP) was seen to have expanded at an annualized rate of 0.2 percent in January-March, according to the poll of 19 analysts, after a 1.1 percent contraction in October-December.

That would translate into a quarterly expansion of 0.1 percent, the poll showed, following a 0.3 percent decline in the final quarter last year.

Analysts say the slight growth was due to the extra day in the quarter from the leap year and that the economy may have even contracted without that factor.

“The GDP data will probably show the actual economy lacks strength,” said Takumi Tsunoda, senior economist at Shinkin Central Bank.

“There are signs of a pickup in exports and corporations keeping firm capital spending plans, which support the economy, while private spending stays at a standstill.”

The poll found private consumption, which accounts for roughly 60 percent of GDP, likely grew 0.2 percent in the first quarter after a 0.9 percent fall in the previous quarter.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza