Japan’s financial system rebounded within the second quarter, returning to development regardless of rising international commerce tensions.
The financial system expanded by a faster-than-expected annualised tempo of 1.9%, supported by non-public consumption.
The expansion got here after Japan’s financial system shrank within the first quarter of 2018 for the primary time in two years.
The discharge of the information comes as Japanese officers are in Washington discussing commerce amid rising international commerce tensions with the US.
Japan’s fee of development within the April-to-June interval beat analysts’ expectations of an annualised fee of 1.4%, and got here after the world’s third-largest financial system contracted by a revised 0.9% within the first quarter.
Client spending underpinned the financial system between April and June, however exterior demand – exports minus imports – weighed on development.
“Whereas actual GDP development in Q2 was each sturdy and better than the consensus forecast, we imagine it’s affordable to conclude that development momentum for the Japanese financial system as a complete is regularly beginning to sluggish,” Nomura mentioned in a analysis word.
The figures got here as Japan’s Minister for Financial Revitalisation Toshimitsu Motegi met US Commerce Consultant Robert Lighthizer in Washington.
Mr Motegi mentioned they’d a “frank change of views” however reiterated Japan’s place that multilateral talks had been one of the best methods to handle commerce points, in keeping with Reuters.
Final yr, the Trump administration deserted the Trans-Pacific Partnership commerce deal, of which Japan is a key stakeholder, as Mr Trump carried out a protectionist agenda after taking workplace in 2016.
The US has since imposed tariffs on a lot of its main buying and selling companions, and threatened to slap tariffs on all Chinese language imports into the US.
In consequence, Japan has been specializing in different markets. Final month, Japan and the European Union signed one of many world’s largest free commerce offers, masking practically a 3rd of the world’s gross home product.