MNI BRIEF: Japan Q4 Capex Up Q/Q; GDP Seen Revised Higher
Combined capital investment by non-financial companies excluding software rose 8.0% q/q in Q4 of 2023, accelerating from 1.0% in Q3, a quarterly survey released by the Ministry of Finance showed on Monday.
The MOF survey, based on the demand side and key to calculate Q4 GDP revisions due March 11, indicated authorities will revise capex higher from the preliminary estimate of -0.1%, based solely on supply side data. Based on the MOF data on capex and inventories, the government will also likely revise up from its Q4 estimate.
Combined capital investment by non-financial companies including software rose 10.4% q/q in Q4 after rising 2.3% in Q3. The expected upward capex revision will ease Bank of Japan’s concern over weaker capex vs. strong capex plans. Capex excluding software rose 16.4% y/y in Q4, up from +3.4% in Q3.
The BOJ will likely lift its easy policy settings at the March or April meeting. (See MNI POLICY: Weak Yen Fuels Wage, Prices; Authorities Vigilant)