Market news
19.05.2022, 10:38

Japan: Economy expected to improve in Q2 – UOB

Alvin Liew, Senior Economist at UOB Group, comments on the latest GDP figures in the Japanese economy.

Key Takeaways

“Despite coming in above expectations, Japan’s 1Q GDP still contracted 1.0% q/q seasonally adjusted annualized rate, due to stalled private consumption spending, a significant drag from external demand and a persistent decline in public investment.”

“Business spending continued to grow but was below expectations, while the other positive contributor was government consumption. After accounting for the 0.2ppt increase from private inventories, overall private demand rose by 0.3% q/q. In comparison, public demand extended its fall in 1Q by -0.2% q/q.”

“We expect the Japanese economy to rebound in 2Q although the extent could be curbed by stronger inflation impacting domestic demand. Japan is also slow to re-open borders to tourism which will be another factor weighing on domestic demand recovery. Meanwhile, manufacturing sector’s recovery continues to be hampered by supply chain disruptions/logistics delays and higher commodity prices due to the on-going Russia-Ukraine conflict and China’s slowdown induced by their COVID-19 lockdowns. The weaker yen is a two-edged sword for Japan as it makes Japan’s exports more attractively priced, but it will worsen the import bill along with the surging commodity prices.”

“We expect Japan to resume its growth trajectory but at a reduced pace of 2.2% q/q SAAR in 2Q (from previous forecast of 3.9%. We now project Japan’s full-year 2022 GDP growth at 1.4% (down from previous forecast of 1.7%), a slowdown from 1.7% in 2021.”

© 2000-2022. All rights reserved.

This site is managed by Teletrade D.J. Limited 20599 IBC 2012 (First Floor, First St. Vincent Bank Ltd Building, James Street, Kingstown, St. Vincent and the Grenadines).

The information on this website is for informational purposes only and does not constitute any investment advice.

AML Website Summary

Risk Disclosure

Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.

Privacy Policy

Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.

Please contact our PR department if you have any questions or need assistance at pr@teletrade.global.

Feedback
Live Chat E-mail
Up
Choose your language / location