Japanese economy ekes out modest growth
The Japanese economy eked out modest growth in the second quarter despite the impact of the Iran war, official data showed Monday, but the reading fell short of market expectations.
The Japanese economy registered modest growth of 0.3 percent in the second quarter, according to data released Monday, falling short of expectations. Higher oil prices have increased Japan's import bill and consumer prices, exacerbated by the weak yen. GDP expanded 1.1 percent on an annualized basis, below the market's 2.0 percent forecast.
The Bank of Japan was anticipated to raise interest rates due to accelerating inflation, but this did not materialize. The weak yen has benefited Japanese exporters like Toyota, which raised its profit forecasts in August. However, capital expenditure fell short of expectations, and private consumption remained flat. Prime Minister Sanae Takaichi, facing declining popularity due to inflation concerns, has expanded government support for voters.
Recent measures include a stimulus package, energy tax rebates, and a reduction in consumption tax on food products. Despite these steps, the GDP figures are considered disappointing, with weak consumption and capital investment driving the growth.
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