Japan To Revise GDP Figures Amid Concerns Of Economic Contraction
The upcoming revision stems from updated construction orders data, with analysts predicting a 2.7% annualized contraction, up from the current 1.8%.
The upcoming revision stems from updated construction orders data, with analysts predicting a 2.7% annualized contraction, up from the current 1.8%. This might lower Japan's growth for the fiscal year ended in March to 1.0%, down from 1.2%. Such adjustments could impact the Bank of Japan's (BoJ) monetary policy, particularly as it mulls over potential interest rate hikes.
The BoJ forecasts a 0.8% expansion for fiscal 2024 but warns that significant GDP downgrades could complicate these plans. The data release may also revise third and fourth-quarter figures from the previous year, shedding light on the broader economic picture.
A sharper-than-expected GDP contraction could unsettle markets, influencing investor sentiment and altering fiscal policy expectations. Many economists anticipate the BoJ will hike interest rates from near-zero levels, possibly as early as the July meeting. However, downgraded economic prospects may defer such plans, affecting everything from bond yields to equity valuations. Investors should remain vigilant of these adjustments, as they could significantly impact market dynamics in the short term.
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