Japanese Market Witnesses Robust Q2 GDP Results

JapanThe Japanese market has shown good results in the Q2 gross domestic product (GDP) performance. Such strong performance has put the entire nation at top of the growth charts that comprises of Group of Seven (G-7) economies.

During the second quarter of fiscal 2017, the Japanese market witnessed an annualized growth of 4 percent. With this, it has recorded its 6th consecutive quarter of expansion, reviving hopes of a sustained recovery in the economy of the nation.

The financial experts are of the opinion that the major reason for the growth is a betterment in the domestic consumption rates that has continued to maintain its momentum over the period.

During the last quarter, the business spending and private consumption were the highest since Q1 2014 as per the latest data. The economy of Japan suffered after the increase in sales tax in April 2014. The adjusted private consumption for the 2nd quarter of 2017 showed a growth of 0.9% over its previous quarter. The adjusted private consumption accounts for approximately 57 percent of Japan’s GDP (Gross Domestic Product).

FRANCE 24 English

The latest data shows that the growth of Japanese market was primarily due to increase in domestic demand that happened for the first time in last quarter. Also, exports were one of the most important factors for the growth in the recent times. There is a 2.4% rise in business spending. The new results have increased the Japanese economy in quarter 2 by a whopping figure of 545 trillion Yen or $4.97 trillion. The Chief Economist for Asia, Rob Carnell, who attended a meeting in Singapore said the growth is something that would continue in the future with the sustained rise.

Carnell further made the following statement;

That makes Japan the fastest-growing economy in the G-7 this quarter by our reckoning and may restart the chatter about the BOJ’s eventual QQE exit strategy. This was not one of those fluky one-offs that were caused by a surge in inventories that will be worked down in coming quarters, or one of those random spikes caused by exports and imports growing out of sync.

The other financial analysts also agree with the views presented by Carnell. The Chief Japan Strategist at Goldman Sachs, Kathy Matsui, said that the economy of Japan is going through a transitional period and it is quite evident from the latest data. There is a continuous rise in the domestic consumption. She further commented that the major reason behind the rise in domestic consumption is the strengthening in the wages of the workers.

However, Japan is not expected to retain the top spot. It is because of many countries in the G7 bloc like Italy, Canada and Germany are yet to release their 2nd quarter data.

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