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MNI BRIEF: Japan's Q3 GDP Falls For First Time in 4 Quarters

--Japan Q3 Real GDP -0.3% Q/Q; Annualized -1.2%

--Japan Q3 Domestic Demand Contribution +0.3 PP

--Japan Q3 Consumption +0.3% Q/Q; +0.1 pp Contribution

--Japan Q3 Capex +1.5% Q/Q; +0.2 PP Contribution

--Japan Q2 Real GDP Revised to +1.1% Q/Q, to +4.6% Annualized

(MNI) Tokyo

Japan's economy contracted for the first time in four quarters during the third quarter due to weaker net exports, although private consumption and capital investment rose, preliminary GDP data released by the Cabinet Office Tuesday showed.

Third quarter GDP fell 0.3% q/q, or an annualized -1.2%, following a revised 1.1% q/q, or an annualized revised 4.6% in the second quarter of 2022.

The Q3 contraction was much weaker than the MNI median forecast that pointed to a rise of 0.3% q/q, or an annualized +1.2%. (See MNI DATA SURVEY: Japan Preliminary GDP For July - September)

GDP for the third quarter totaled JPY543 trillion, after posting JPY545 trillion for the second quarter, above the pre-Covid-19 level of JPY540 trillion recorded in the October-December 2019 period. (See MNI BRIEF: BOJ TO Keep Easy Policy To Support Economy - Kuroda)

Private consumption, which accounts for about 60% of Japan's GDP, rose 0.3% q/q in Q3, for the fourth straight rise after an unrevised 1.2% rise in Q2. The median forecast was for a 0.5% q/q rise. Business investment rose 1.5% q/q in Q3, the second straight rise following a revised +2.4% in Q2. The median forecast was for a 2.0% rise.

Net exports of goods and services - exports minus imports - made a negative 0.7 percentage point contribution to total domestic output after pushing Q2 GDP growth up 0.2 percentage point. Exports rose 1.9% on quarter in Q3 after rising 1.8% q/q in Q2. Imports rose 5.2% in Q3 after rising 0.8% in the previous quarter.

Private-sector inventories contributed a negative 0.1 percentage point to Q3 GDP following -0.2 of a percentage point in Q2, while public investment rose 1.2% on the quarter, contributing +0.1 pp to GDP.

MNI Tokyo Bureau | +81 90-2175-0040 | hiroshi.inoue@marketnews.com
MNI Tokyo Bureau | +81 90-2175-0040 | hiroshi.inoue@marketnews.com

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