Japan’s economy expanded less than estimated in the fourth quarter and the current-account deficit widened to a record in January, highlighting risks to Abenomics as a sales-tax increase looms.
Gross domestic product grew an annualized 0.7 percent from the previous quarter, the Cabinet Office said today in Tokyo, less than a preliminary estimate of 1 percent and a 0.9 percent median forecast in a Bloomberg News survey of 20 economists. The current-account deficit widened to 1.59 trillion yen ($15.4 billion), a record in data back to 1985, the finance ministry said.
While growth is set to surge this quarter before the bump in the sales tax next month, Prime Minister Shinzo Abe’s task is to steer the nation through a projected contraction in the April-June period. The prime minister is due to detail growth measures in June, while economists forecast the Bank of Japan will add to unprecedented easing to keep the world’s third-biggest economy on track for a 2 percent inflation target.
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