Japan Economy Projected to Have Grown 1.8 Pct in 1st Quarter

Tokyo, May 14 (Jiji Press)–Japan’s economy is projected to have grown at an annualized pace of 1.8 pct in the first three months of the year in inflation-adjusted real terms to mark the second consecutive quarter of expansion, according to average estimates by 10 private think tanks. While the impact of the war in Iran, which began in late February, is believed to have been limited during the first quarter, it is expected to be felt in the second quarter. The Cabinet Office is set to release preliminary gross domestic product data for the January-March period on Tuesday. The think tanks project a 0.2 pct quarter-to-quarter rise in personal consumption, the main pillar of domestic demand, reflecting the abolition of provisional gasoline tax surcharges as well as the government’s electricity and city gas subsidies. Capital expenditure is estimated to have increased 0.2 pct, while housing investment is expected to post growth of 0.8 pct. Exports are seen to have expanded 1.2 pct, thanks to a recovery in shipments to the United States, particularly automobiles, after the impact of U.S. President Donald Trump’s tariffs waned and because of strong demand for semiconductors. Imports are believed to have risen 0.2 pct. The effective closure of the Strait of Hormuz “had little impact as vessels that had passed before the closure arrived in Japan until around mid-March,” said Ryosuke Katagi, a market economist at Mizuho Securities Co. END [Copyright The Jiji Press, Ltd.]