Japanese Economy Narrowly Escapes Technical Recession

Revised data from Japan has revealed that the economy returned to growth in the October-December period of last year, narrowly avoiding a technical recession with a 0.1% quarter-on-quarter and a 0.4% year-on-year expansion.

The latest figures indicate that the country’s Gross Domestic Product (GDP) for the fourth quarter experienced a 0.1% increase compared to the previous quarter and a 0.4% rise on an annual basis, thanks in part to robust capital spending during the mentioned period.

Temporary data had previously shown a 0.1% quarter-on-quarter contraction and a 0.4% year-on-year decline in Japan’s economy for the previous quarter. In the third quarter, Japan’s GDP had registered a 0.8% decrease compared to the preceding quarter and a 3.2% annual decline.

Analysts note that signs of potentially strong wage increases during this year’s spring wage negotiations between unions and employers have heightened expectations that the Bank of Japan (BoJ) could normalize its monetary policy during its meeting on March 18-19. The apparent optimism stems from the belief that the central bank may consider policy adjustments in response to positive signals in wage discussions among unions and employers.

source: prepared by Melisa Beğiç

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