MNI: Analysts See Japan Q4 GDP Revised Up Slightly on Capex

--Revised Q4 GDP Seen +0.8% Annualized Vs Prelim +0.5% 

     TOKYO (MNI) - Japanese fourth-quarter gross domestic product will be

revised up slightly from the initial estimate as business investment and public

works spending appear to be firmer than initially reported, economists forecast

Thursday.

     Analysts' forecasts for the revision are based on the latest government

quarterly business survey and other indicators, but economists warn seasonal

adjustments made to past figures could also affect the calculation.

     The Cabinet Office will release revised (second preliminary) GDP data for

the October-December quarter at 0850 JST on Thursday, March 8 (2350 GMT

Wednesday, March 7).

     The median forecast by eight economists for revised Q4 GDP is +0.2% on

quarter, or an annualized +0.8%, up from the preliminary estimate of +0.1% q/q,

or an annualized +0.5%. The forecasts ranged from +0.1% to +0.3% q/q, or +0.6%

to +1.2% at an annualized pace.

     --CAPEX UPWARD REVISION

     Capital investment is forecast by economists to be revised up to +1.2% on

quarter from the initial reading of +0.7%, with forecasts in a range of +0.4% to

+1.5%, following the Ministry of Finance's release Thursday of its quarterly

survey of major companies.

     Economists expect private consumption, which accounts for about 60% of the

GDP, to be unchanged from the preliminary estimate that showed a 0.5% rise on

quarter, which pushed down the Q3 GDP figure by 0.3 percentage point in the

preliminary reading. NLI Research chief economist Taro Saito is calling for a

slight upward revision to +0.6% q/q, citing the government's monthly survey on

service industries, which showed a 1.5% year-on-year rise in sales in Q4, up

from +1.4% in Q3.

     --INVENTORIES SEEN UNREVISED

     The contribution of private-sector inventories to the total domestic output

is forecast to be -0.1 percentage point, unrevised from the preliminary report.

     Economists expect no change to the initial estimate that net exports of

goods and services -- exports minus imports -- made a negative 0.1 percentage

point contribution to total domestic output. It was the first negative

contribution in two quarters after pushing up Q3 GDP growth by 0.5 percentage

point.

     --PUBLIC INVESTMENT FIRMER

     Economists expect public investment to be revised up to a drop of 0.2% on

quarter in Q4 from a preliminary 0.5% fall. The forecasts ranged from -1.5% to

+0.3% q/q.

     The Ministry of Finance survey showed that combined capital investment by

non-financial Japanese companies rose 4.3% on year in the October-December

quarter, the fifth straight quarter of increase after rising 4.2% in

July-September.

     On quarter, combined capital outlays (excluding software) posted the second

straight quarter-on-quarter rise, up 3.1% on a seasonally adjusted basis in Q4,

after rising 2.1% in Q3.

     The MOF's demand-side survey is the key to calculating revisions to

preliminary GDP. The capex figure in the preliminary GDP calculation is based

solely on supply side data.

--MNI Tokyo Bureau; tel: +81 90-4670-5309; email: max.sato@marketnews.com

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