close
This ad will auto close in 10 seconds

Japan economic growth flat in April-June quarter: Govt

On an annualised basis, the economy expanded by a slight 0.2 percent, well off expectations for 0.7 percent growth.



Tokyo: Japan`s economy stagnated in the April-June quarter, data showed Monday, falling below expectations and rekindling worries about the government`s faltering bid to stoke a recovery.

Growth in the world`s third largest economy was flat at 0.0 percent quarter-on-quarter, missing economists` predictions for a 0.2 percent expansion as weak exports and a fall in business spending held back activity.

On an annualised basis, the economy expanded by a slight 0.2 percent, well off expectations for 0.7 percent growth.

Japan`s economy grew 0.5 percent in the first quarter -- 1.9 percent annualised -- after a contraction in the last three months of 2015.

Monday`s weak figures come as Japanese officials face growing pressure to deliver and economists increasingly write off Prime Minister Shinzo Abe`s stumbling efforts to drive a recovery, dubbed Abenomics.

Recent government figures have done little to soothe those worries.

Inflation dropped for a fourth straight month in June, delivering a fresh blow to Abe`s war on deflation.

Business confidence has slumped to levels last seen when Abe swept to power in late 2012 on a ticket to fire up an economy beset by years of falling prices and weak growth.

Japan`s government recently announced a whopping 28 trillion yen ($276 billion) package aimed at kickstarting growth.

The fiscal package, which included infrastructure spending and efforts to raise the birthrate, was the latest in a series in recent years.

The second quarter drop in business spending comes as a sharp rally in the yen threatens corporate Japan`s bottom line -- aggravating concerns about growth.

Investors tend to buy Japan`s currency as a safe bet in times of turmoil or uncertainty.

But it makes its exporters less competitive overseas and hits profits at Japan Inc, a problem highlight recently as many of the county`s biggest firms reported lower profits in the three months to June.
 

From Zee News

0 Comment - Join the Discussions