Econintersect:  Japan had a second consecutive quarter of economic growth for the January-March 2012 quarter, with GDP increasing at a 4.1% annual rate (1% during the quarter).  This growth was an improvement on the revised 0.1% growth rate in the fourth quarter of 2011.  Japan has now had three consecutive quarters of GDP growth which have followed three declining quarters immediately preceding.   The three most recent gains (totaling 3.1%) still have not recouped the three previous declines (totaling 4.0%).  And the latest GDP number is still 7.6% below the level for 4Q/2007.

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Econintersect: Looking into the minds of the members of the Federal Open Market Committee (FOMC) gives insights on how they view the economy. The April 25, 2012 meeting statement provided the actions taken, but the meeting minutes released today provides the detailed discussion.

It appears that the FOMC members believe the economy is improving but are uncertain that the improvements are sustainable.

There seemed to be an unusual amount of uncertainty on employment - see meeting minute extract below.  In addition, it seems that a division in the FOMC is developing on establishing set monetary policy benchmarks for reacting economic conditions.

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Econintersect:  The Rupee has declined by 12.4% since early February and by 5.8% in just the last 30 days.

"The rupee dropped as low as 54.46 per dollar, breaching its previous record low of 54.30 in December. It was last trading at 54.34/36 compared to a close of 53.79."

The Economic Times, 16 May 2012

Many causes are behind this situation; mainly, the rupee falling was a consequence of the European Union Crisis that has led to an increase for investments in the USA and a shrinking of foreign investments in India.  In general, investors prefer to put their money wherever the economy is more stable.  Thus, Asian economies such as that of India are being negatively impacted.

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