Japan’s economy contracted for a second straight quarter in July-September, revised government data showed yesterday, indicating that weak global demand nudged the export-reliant economy into a mild recession.
Analysts expect another quarter of contraction in the final three months of this year due to sluggish exports to China, keeping the Bank of Japan under pressure to loosen monetary policy as early as this month.
“There have been some positive indicators out in October but there is still a good chance that Japan’s economy will suffer another contraction in the October-December quarter,” said Takeshi Minami, chief economist at Norinchukin Research Institute in Tokyo.
“The Bank of Japan may ease policy this month, as suggested in remarks by Deputy Governor Kiyohiko Nishimura last week. The bias is for further easing, so even if the central bank stands pat this month it will likely act in January,” he said.
Japan’s GDP shrank 0.9 percent in July-September from the previous quarter, revised government figures showed, unchanged from preliminary data reported last month. That compared with economists’ median forecast for a 0.8 percent contraction.
The figure translates into an annualized contraction of 3.5 percent in real, price-adjusted terms, which is also unchanged from the preliminary data issued last month.
The government revised GDP figures for April-June to show a small contraction of 0.03 percent, indicating that the economy contracted for two straight quarters and meeting the technical definition of a recession. The previous figure had shown growth of 0.1 percent.
Capital expenditure fell a revised 3 percent in the third quarter, compared with a 2.8 percent decline expected by economists and a preliminary reading of a 3.2 percent decline.
Separate data showed Japan’s current account surplus fell 29.4 percent in October from a year earlier, compared with the median estimate for a 59.2 percent annual decline, largely due to shrinking exports and increasing costs of fuel oil imports.
The nation’s consumer confidence and service sector business sentiment showed mixed results last month.
The survey’s sentiment index for general households, which includes views on incomes and jobs, fell for the third month in a row.
This prompted the government to cut its assessment on consumer confidence, saying there were signs of weakness.
Meanwhile, Japan’s service sector sentiment index, a survey of workers such as taxi drivers, hotel workers and restaurant staff, slightly improved for the first time in four months, but the government kept its view on the index that the economy remained weak.
Nishimura said last week the central bank will debate whether further stimulus is needed to support the economy, offering the strongest signal to date that it may loosen policy again at its next rate review on Dec. 19 and Dec. 20 in the face of growing political pressure.
‘DECENT RESULTS’: The company said it is confident thanks to an improving world economy and uptakes in new wireless and AI technologies, despite US uncertainty Pegatron Corp (和碩) yesterday said it plans to build a new server manufacturing factory in the US this year to address US President Donald Trump’s new tariff policy. That would be the second server production base for Pegatron in addition to the existing facilities in Taoyuan, the iPhone assembler said. Servers are one of the new businesses Pegatron has explored in recent years to develop a more balanced product lineup. “We aim to provide our services from a location in the vicinity of our customers,” Pegatron president and chief executive officer Gary Cheng (鄭光治) told an online earnings conference yesterday. “We
It was late morning and steam was rising from water tanks atop the colorful, but opaque-windowed, “soapland” sex parlors in a historic Tokyo red-light district. Walking through the narrow streets, camera in hand, was Beniko — a former sex worker who is trying to capture the spirit of the area once known as Yoshiwara through photography. “People often talk about this neighborhood having a ‘bad history,’” said Beniko, who goes by her nickname. “But the truth is that through the years people have lived here, made a life here, sometimes struggled to survive. I want to share that reality.” In its mid-17th to
‘MAKE OR BREAK’: Nvidia shares remain down more than 9 percent, but investors are hoping CEO Jensen Huang’s speech can stave off fears that the sales boom is peaking Shares in Nvidia Corp’s Taiwanese suppliers mostly closed higher yesterday on hopes that the US artificial intelligence (AI) chip designer would showcase next-generation technologies at its annual AI conference slated to open later in the day. The GPU Technology Conference (GTC) in California is to feature developers, engineers, researchers, inventors and information technology professionals, and would focus on AI, computer graphics, data science, machine learning and autonomous machines. The event comes at a make-or-break moment for the firm, as it heads into the next few quarters, with Nvidia CEO Jensen Huang’s (黃仁勳) keynote speech today seen as having the ability to
The battle for artificial intelligence supremacy hinges on microchips, but the semiconductor sector that produces them has a dirty secret: It is a major source of chemicals linked to cancer and other health problems. Global chip sales surged more than 19 percent to about US$628 billion last year, according to the Semiconductor Industry Association, which forecasts double-digit growth again this year. That is adding urgency to reducing the effects of “forever chemicals” — which are also used to make firefighting foam, nonstick pans, raincoats and other everyday items — as are regulators in the US and Europe who are beginning to
RSS