Japan downgrades Q2 GDP as trade war hits business investment

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JAPAN'S economy grew at a slower pace than initially estimated in the second quarter as the US-China trade war prompted a downward revision of business spending, intensifying calls for the central bank to deepen stimulus this month. Read more at The Business Times.

Japan's economy grew at a slower pace than initially estimated in the second quarter as the US-China trade war prompted a downward revision of business spending, intensifying calls for the central bank to deepen stimulus this month.JAPAN'S economy grew at a slower pace than initially estimated in the second quarter as the US-China trade war prompted a downward revision of business spending, intensifying calls for the central bank to deepen stimulus this month.

Capital spending rose just 0.2 per cent from the previous quarter, much lower than a preliminary 1.5 per cent rise and the median forecast for a 0.7 per cent increase. The capex downgrade was due to government statisticians including a demand-side survey of capex in the revised GDP data, which was not in the preliminary figures and showed weakness in the sector.

Private consumption, which accounts for some 60 per cent of gross domestic product, advanced 0.6 per cent from the previous three months, matching the preliminary reading. A separate Cabinet Office survey released on Monday pointed to a bleak outlook for consumption. The survey called the"economy watchers" sentiment index, which measures business confidence among workers such as taxi drivers, hotel workers and restaurant staff, was marginally higher than a more than three-year low hit in July.

 

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