Japan Q2 GDP probably back to growth, averting technical recession: Reuters poll
A man works at a supermarket in Tokyo, Japan June 21, 2022. REUTERS/Issei Kato/File Photo
TOKYO :Japan's economy probably grew marginally in April-June due to resilient consumption and net exports, managing to avoid a technical recession, or two straight quarters of contraction, a Reuters poll showed on Friday.
Gross domestic product (GDP) in real terms expanded an annualised 0.4 per cent in the second quarter, according to the median forecast of 16 economists, following an annualised 0.2 per cent drop in the first quarter.
Without annualisation, the second-quarter growth rate was estimated at 0.1 per cent.
Japan's GDP "likely achieved positive growth for the first time in two quarters, supported by resilient domestic demand ... and a slight recovery in external demand," said Shinichiro Kobayashi, principal economist at Mitsubishi UFJ Research and Consulting.
Private consumption, which accounts for more than half Japan's GDP, probably grew 0.1 per cent in April-June, at the same rate as in January-March, despite a prolonged period of high consumer inflation.
But capital expenditure growth was seen slowing to 0.5 per cent from the previous quarter's 1.1 per cent.
External demand or net exports, which is exports minus imports, probably added 0.2 per centage points to the second-quarter GDP growth, after it shaved 0.8 points in the first quarter.
Although Japanese exports decreased year-on-year in May and June, led by falling car shipments to the United States amid President Donald Trump's tariffs, a faster decline in imports was likely to have resulted in a positive net export contribution in April-June quarter, analysts said.
On Thursday, the Bank of Japan kept interest rates steady but offered a less gloomy economic outlook after Japan reached a trade deal with the U.S. last week to lower levies on Japanese exports. A majority of analysts expected an additional rate hike by year-end in a Reuters survey last month.
The government will release the April-June GDP data on August 15 at 8:50 a.m. (2350 GMT on August 14).
