Japan upgraded on Thursday its growth projections for the next fiscal year starting in April, saying it expected gross domestic product (GDP) to hit a record even amid risks from the Omicron variant and supply constraints, Cabinet Office officials said.
The growth projection was raised to 3.2% for fiscal 2022 from a forecast 2.2% real GDP growth seen at a mid-year review in July, helped by a record extra stimulus budget approved by parliament this week.
It would be the fastest growth since fiscal 2010 when the economy grew 3.3% in the aftermath of the global financial crisis. The stimulus spending is expected to push up GDP by 1.5% this fiscal year and 3.6% next fiscal year, the officials said.
But the government sharply downgraded Japan’s real GDP estimates to 2.6% in the current fiscal year ending in March from 3.7% previously, as the prolonged COVID-19 pandemic and supply constraints in chip production weigh on the recovery.
Given these factors, the government said the economy’s return to pre-pandemic levels will be delayed into the fiscal year-end next March from the previous forecast of by December.
“The economy has shown signs of picking up, so we must ensure the current positive momentum moves to sustainable economic recovery,” a Cabinet Office official told reporters.
“We have not yet reached autonomous growth but we’re making steady progress to generate a virtuous cycle of growth and wealth distribution.”
The revised forecasts were approved by Prime Minister Fumio Kishida’s cabinet on Thursday. It will provide the basis for the fiscal 2022 budget to be compiled on Friday.
Japan’s economy, the world’s third largest, contracted an annualised 3.6% in the July-September quarter following a resurgence of COVID-19 cases, putting a drag on private consumption that makes up more than half of GDP.
Japan has lagged behind other advanced nations in embarking on exiting crisis-mode stimulus, keeping policymakers under pressure to continue aggressive fiscal and monetary stimulus.
(Reporting by Tetsushi Kajimoto; Editing by Jacqueline Wong)
OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.
However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.
The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.
Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.
The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.
The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.
This report by The Canadian Press was first published Oct. 17, 2024.
OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.
In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.
The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.
Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.
In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.
It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.
This report by The Canadian Press was first published Oct 16, 2024.
OTTAWA – Statistics Canada says manufacturing sales in August fell to their lowest level since January 2022 as sales in the primary metal and petroleum and coal product subsectors fell.
The agency says manufacturing sales fell 1.3 per cent to $69.4 billion in August, after rising 1.1 per cent in July.
The drop came as sales in the primary metal subsector dropped 6.4 per cent to $5.3 billion in August, on lower prices and lower volumes.
Sales in the petroleum and coal product subsector fell 3.7 per cent to $7.8 billion in August on lower prices.
Meanwhile, sales of aerospace products and parts rose 7.3 per cent to $2.7 billion in August and wood product sales increased 3.8 per cent to $3.1 billion.
Overall manufacturing sales in constant dollars fell 0.8 per cent in August.
This report by The Canadian Press was first published Oct. 16, 2024.
