MNI BRIEF: Japan Q1 GDP To Be Largely Unchanged

Japan's economy in the January-March period contracted in line with initial estimates as major components, such as capital investment and private consumption, changed little, economists predicted in the wake of a key government survey.

The median forecast by seven economists for revised Q1 GDP is -0.5% on quarter, or an annualised -2.1%, compared with the preliminary estimate of -0.5% q/q, or an annualised -2.0%.

The economists expected capex to be revised to -0.6% q/q from the initial estimate of -0.8% following the government’s data, which showed capex excluding software fell 0.5% q/q in Q1, down from 8.2% growth in Q4. The forecasts of capex ranged from -0.4% to -3.5% q/q.

The Cabinet Office will release revised (second preliminary) GDP data for the January-March quarter at 0850 JST on Monday, June 10 (2350 GMT on Sunday, June 9).

Private consumption is forecast by the economists to be unrevised at -0.7% on quarter. Economists expected public investment to be revised down to +3.0% q/q in Q1 from initial estimate of +3.1%. The contribution of private-sector inventories to the total domestic output is forecast to be unrevised at +0.2 percent points.

Net exports of goods and services are expected to have made a negative 0.3 pp contribution to the total domestic output, unchanged from the preliminary estimate.