The Japanese economy grew at an annual pace of 0.6 percent last year in the October-to-December period, the government reported yesterday, managing to eke out growth after a contraction in the previous quarter.
The world’s third-largest economy has struggled amid restrictions related to the COVID-19 pandemic, a shortage of imported parts from China and rising prices — especially energy — worsened by inflationary pressures and the war in Ukraine.
The easing of COVID-19 restrictions, abroad and in Japan, has helped a recovery in tourism and other economic activity.
Photo: AFP
The Japanese Cabinet Office reported that the economy grew 0.2 percent in the last quarter, compared with the July-to-September period, when it contracted 0.3 percent. It grew 1.1 percent in from April to June.
For the whole year, the seasonally adjusted real GDP, which measures the value of goods and services a nation produces, grew 1.1 percent from the year before.
Household consumer demand and government spending grew in the final quarter of last year, and exports grew, but imports fell, the data showed.
The numbers suggest a gradual economic rebound.
In October last year, Japan eased its tough restrictions on inbound travel. Optimism has been growing about a return to normal.
Wage increases have been slow to come, despite recent signs of growing inflation even in deflation-prone Japan.
The weakening yen tends to help growth, as it boosts the overseas earnings of Japanese exporters when they are converted into yen. The currency’s weakening reversed course somewhat in the last quarter, helping to alleviate the burden of soaring costs for imports.
The yen sank to about ￥150 to the US dollar last year, but has recently been trading at about ￥130.
Separately, Kazuo Ueda, a former member of the Bank of Japan’s (BOJ) policy board, was yesterday nominated to head the central bank and take on the daunting task of guiding the nation’s economy to stable growth.
BOJ Governor Haruhiko Kuroda is to step down on April 8 after serving two five-year terms, during which he pushed an unprecedented ultra-easy credit strategy meant to vanquish deflation, or chronically falling prices.
While other major central banks have aggressively raised interest rates to cool decades-high inflation, the BOJ has stuck to monetary easing. Its key interest rate remains at minus-0.1 percent.
The government of Japanese Prime Minister Fumio Kishida, whose support ratings have sagged, presented Ueda and other nominees for top BOJ posts to parliament. Ueda is to face questioning by lawmakers, but approval of his nomination is likely given that both houses of parliament are controlled by the ruling Liberal Democratic Party.
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