Japan’s economy expanded faster than previously thought in the first quarter, fresh data showed yesterday, a result that is likely to boost support for Tokyo’s efforts at stoking growth.
The Japanese Cabinet Office said revised data showed annualized growth came in at 4.1 percent in the January-to-March period, up from a preliminary reading of 3.5 percent and well ahead of many other industrialized nations who are struggling to stoke their economies.
The annualized figures, which show the level of growth if quarterly data were stretched over an entire year, comes as economists sift through recent figures for signs that Japanese Prime Minister Shinzo Abe’s economic plan is taking hold.
The IMF has said it expects Japan’s economy to grow 1.6 percent this year.
The office also said revised figures for real GDP showed that Japan’s economy grew 1 percent in the first three months of the year, slightly better than the preliminary 0.9 percent growth reading.
The improvement was partly due to an upward revision in capital spending, a key measure of confidence among the nation’s producers.
In other upbeat data, consumer confidence improved last month over the previous month, with the number of Japanese who expect prices to rise sitting at a near five-year high as Tokyo works to reverse years of falling prices which have crimped private spending and business investment.
“We expect the economy will continue to grow for now but consumer spending may be dampened in the current quarter after a sizeable adjustment in the Nikkei [225 Stock Average] index,” said Hideki Matsumura, senior economist with the Japan Research Institute, referring to a recent drop in the Tokyo stock market.
Tokyo stocks surged 4.94 percent yesterday on the back of a weaker yen and better-than-expected US jobs data.
Adding to buying sentiment were the revised GDP data, but investors are keeping an eye on a two-day policy meeting at the Bank of Japan, ending today, for fresh signs of further policy moves.
“Players are now anxious to see if the Bank of Japan will announce any changes to current policy,” Tachibana Securities market adviser Kenichi Hirano told Dow Jones Newswires.
The benchmark Nikkei 225, which lost 6.51 percent last week, closed up 636.67 points to 13,514.20, while the TOPIX of all first-section issues soared 5.21 percent, or 55.02 points, to 1,111.97.
Also yesterday, official figures showed Japan posted a surplus on its current account for the third straight month in April, as the weaker yen helped boost the value of income from overseas investments.
Japan’s surplus doubled year-on-year to ￥750 billion (US$7.6 billion) in its current account, helping offset a widening trade deficit.
Japan’s import bills have soared in the wake of the atomic crisis at the Fukushima Dai-ichi nuclear power plant two years ago, which saw Tokyo turn to pricey fossil fuel alternatives after switching off the country’s nuclear reactors.