Japan Govt Likely to Lower 1st-Quarter Growth Rate

Tokyo, June 5 (Jiji Press)–The Japanese government is expected to lower the country’s annualized real gross domestic product growth rate for the first quarter of the year to 1.4 pct from 2.1, according to the average forecast of 10 private think tanks. The downward revision is likely because Finance Ministry data, released on Monday, showed that corporate capital investment fell in the January-March period from a year before. The revised GDP data will likely show that capital investment dropped 1 pct quarter on quarter, worse than the previously reported rise of 0.3 pct, according to the think tanks’ average estimate. The Cabinet Office is scheduled to release its revised GDP data on Monday. The Japanese economy struggles with soaring commodities prices and supply chain disruptions caused by the war in Iran. Personal consumption is likely to avoid a sharp downturn partly thanks to the government’s gasoline subsidies. But petrochemical makers have been forced to reduce production and raise prices due to shortages of raw materials. “We can’t rule out the possibility of negative growth” for the second quarter, said Yoshiki Shinke, senior executive economist at Daiichi Life Research Institute Co. END [Copyright The Jiji Press, Ltd.]