Japan GDP Preview: Forecasts from four major banks, growth to have moderated

Japan will release third quarter (Q3) Gross Domestic Product (GDP) figures on Monday, November 14 at 23:50 GMT and as we get closer to the release time, here are forecasts from economists and researchers of four major banks regarding the upcoming growth data. 

Growth is expected at 1.2% SAAR vs. 3.5% in Q2 and expected at 0.3% quarter-on-quarter vs. 0.9% in Q2.

Standard Chartered

“We expect GDP growth to have slowed to 0.3% QoQ (seasonally adjusted) from 0.9% in the previous quarter when the growth rebound was boosted by pent-up demand. We expect GDP to continue to expand, albeit at a slow pace, reflecting a gradual recovery from the pandemic impact. Also, weaker global growth due to China’s zero-COVID policy and the prolonged Russia-Ukraine war likely weighed on Japan’s exports. That said, easing supply bottlenecks in the auto sector and an improving COVID-19 situation may have supported growth. Japan’s job market has also remained resilient, likely supporting consumption, but limited wage growth likely weighed on consumption growth.”

ING

“Third quarter GDP in Japan is expected to grow 0.5% QoQ, seasonally adjusted, which is a slower pace than the previous quarter. Reopening effects still led the overall growth but higher inflation and the weak yen partially offset the recovery.”

Wells Fargo

“Japan is expected to report slower economic growth for Q3. Third-quarter GDP growth is forecast to slow to 1.2% QoQ annualized, reflecting a sharp slowdown in consumer spending even as investment spending is expected to continue rising at a steady clip. Against this relatively subdued economic backdrop, the BoJ appears unlikely to adjust its monetary policy stance for the time being, while the government is also pursuing another fiscal stimulus package to help consumers deal with higher living costs, while also supporting growth in the quarters ahead.”

SocGen

“We forecast real GDP growth of +0.3% QoQ (annualised, +1.2% QoQ) for 3Q22. Growth is expected to slow somewhat from the previous quarter due to downward pressure from the rapid spread of the novel coronavirus pandemic. A substantial increase in imports will also significantly depress growth in 3Q22.”