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(M1) New Multi-Month Highs

MNI (London)
--Japan Q4 Real GDP -1.6% Q/Q, -6.3% Annualized
--Japan Q4 Domestic Demand Contribution -2.1 PP 
--Japan Q4 Capex -3.7% Q/Q, -0.6 PP Contribution 
     TOKYO (MNI) - Japan's economy contracted for the first time in five
quarters in Q4, down 1.6% q/q, or an annualized -6.3%. Growth was weighed by
weak demand in the private sector following a string of natural disasters and
the October 1 sales tax hike, preliminary GDP data released by the Cabinet
Office Monday showed.
     It was the sharpest contraction since Q2 2014, when GDP fell an annualized
-7.4% after a previous sales tax hike.
     The Q4 decline was much weaker than the MNI median forecast for contraction
of 1.0% q/q, or the annualized forecast of -3.8% and reversed a revised 0.1% q/q
rise in Q3.
     The key points from the latest GDP data:
     --Private consumption, which accounts for about 60% of Japan's GDP, fell
2.9% q/q in Q4, after an unrevised 0.5% gain in Q3. The median forecast was for
a 2.0% q/q decline.
     --Business investment fell 3.7% q/q in Q4, the first drop in three
quarters, underperforming expectations.
     --Net exports of goods and services -- exports minus imports -- made a
positive 0.5 percentage point contribution to total domestic output, the first
positive contribution in three quarters after pushing Q3 GDP growth down by 0.3
percentage point.
     --Exports fell 0.1% on quarter in Q4 after falling 0.7% in Q3. Imports fell
2.6% after rising 0.7% in the previous quarter.
     --Private-sector inventories contributed a positive 0.1 percentage point to
Q4 GDP following -0.2 percentage point in Q3, while public investment rose 1.1%
on quarter, contributing 0.1 pp to GDP.
--MNI Tokyo Bureau; tel: +81 90-2175-0040; email:
--MNI London Bureau; tel: +44 203-586-2225; email:
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