Japan’s economy has grown for the third straight quarter thanks to higher personal consumption, data from April to June showed on Monday, a sign that the country was still staging a long-delayed recovery after a Covid-induced slowdown.
But the outlook remains due to a rise in COVID-19 infections, slowing global growth, source constraints, and emerging commodity charges that are driving up households’ cost of living.
Gross domestic product (GDP) in the world’s third-largest economy grew by an annualized 2. 2 percent in the current quarter, following a revised 0. 1 percent increase in January-March, according to government data. 2,5%.
The growth was largely due to a 1. 1% increase in personal consumption, which accounts for more than a portion of Japan’s GDP, according to the data. However, the accumulation is below market expectations of a 1. 3% accumulation.
Capital spending rose 1. 4 times more than the market’s average forecast of a 0. 9 expansion, according to the data.
External demand for GDP growth neither aggregate nor reduced, compared to an expected contribution of 0. 1 points.
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Japan lagged behind other primary economies to fully recover from the pandemic due to weak consumption, in part due to the slowdown in activity that lasted until March.
This has made the Bank of Japan an outlier in the global financial tightening that is affecting many economies amid soaring inflation.
Policymakers expect pent-up demand to rise until wages rise enough to offset the emerging life burden. But there is uncertainty about whether companies will raise wages amid the heightened dangers of slowing global demand, analysts say.
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