Japan GDP Falters

February 17th, 2014
in econ_news, syndication

Econintersect:  Weak exports shot a hole in Japan's GDP growth in 4Q/2014.  The quarter-over-quarter gain came in at 0.3%, less than half of what had been expected.  breakingnews130pxThe latest result matched the growth achieved in each the second and the third quarters.  A negative balance of trade subtracted a huge 3.1% because imports growing by 3.5% in the fourth quarter simply swamped the meager growth of exports by 0.4%.  Japan's surge in imports is driven by the large increase in energy imports as a result of the shutdown on the nation's nuclear facilities in response to the nuclear plant disaster at Fukushima almost three years ago.  This increase is aggravated by a 30% drop in the value of the yen in U.S. dollar exchange over the past 18 months.  Energy is priced in dollars.

Follow up:

Domestic growth in the fourth quarter was strong, especially from the private sector.  Consumer spending was up 0.5% for the quarter, company capital investment rose by 1.3% and housing investment was up 4.2%.


The numbers today are the first preliminary release of data and will be revised with later updates in March and April.

John Lounsbury



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