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TOKYO: Japan's economy expanded more than initially thought in the second quarter, government data showed Friday, as domestic firms ramped up capital expenditure.
Japan's gross domestic product grew by an annualised 1.5 per cent in the April-June quarter, well above an initial estimate of 0.4 per cent, data showed.
On a quarterly basis, growth was revised higher to 0.4 per cent from 0.1 per cent. The revision was in line with a Dow Jones Newswires and Nikkei business daily forecast of economists.
The mark up was helped by a revised 1.5 per cent gain in private capital investment.
"An increase in corporate investment and a slower pace of decline in private inventory contributed to the upward revision," a cabinet office official told reporters.
The latest data nevertheless represents a slowdown from the previous quarter's revised annualised growth of 5.0 per cent, and Japan remains under pressure to safeguard a fragile, export-led recovery beset by deflation.
The yen's recent appreciation to 15-year highs against the dollar has put many Japanese exporters at a disadvantage against foreign rivals, as it erodes their repatriated earnings.
The Bank of Japan recently expanded a multi-billion dollar loan scheme and the government pledged a fresh 920 billion yen stimulus package after preliminary GDP estimates in August showed growth slowing down.
On a dollar-denominated nominal basis Japan's GDP in the April-June quarter stood at 1.2948 trillion dollars, below that of China which stood at 1.3369 trillion dollars, the cabinet ministry official said.
Japan's post-war "economic miracle" put it at number two behind the US for more than 40 years, but stagnation after its property bubble burst in the 1990s has helped put China on course to supplant it this year.
China has already claimed the titles of world's biggest exporter, auto market and steelmaker.
Japan remains more than 10 times richer on a per-capita basis, according to the International Monetary Fund.
-AFP/wk
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