MNI BRIEF: Japan Q2 GDP Revised Lower On CAPEX

MNI (TOKYO) - Japan's economy for the April-June period grew at 0.7% q/q, 10 basis points lower than market expectations, as capital investment and public investment were revised down from first preliminary estimates, second preliminary data released by the Cabinet Office showed on Monday.

Capex rose 0.8% q/q, revised down from 0.9% seen in the preliminary release. The positive contribution from capital investments was revised to 0.1 percentage points from 0.2 pp.

Public investment rose 4.1% q/q, also revised down from 4.5%, but the GDP contribution of public investment was unrevised at 0.2 pp. Private consumption which accounts for about 60% of Japan’s GDP, was also revised to 0.9% from 1.0%, but its contribution was unrevised to 0.5 pp.

The contribution of net exports was unrevised at -0.1 pp. Private-sector inventories to total domestic output contributed an unrevised at -0.1 pp.

BOJ officials are increasingly confident prices and wages data will further confirm progress towards the Bank’s 2% inflation target in time for the likely next rate hike as early as December. (See MNI POLICY: BOJ Confidence Grows As Focus Shifts To December)