TOKYO (Reuters) – Japan’s economy likely rebounded in the third quarter as global demand picked up, a Reuters poll showed, but the effects of the coronavirus crisis persisted and it could take some time to return to pre-pandemic levels.
Gross domestic product (GDP) is forecast to have grown an annualised 18.9% in July-September, the poll of 18 economists showed, the fastest pace of growth on record since comparable data became available in 1980.
On a quarter-on-quarter basis, GDP is expected to have expanded 4.4% in the third quarter after it contracted 7.9% in the previous three months, the poll showed.
A return to growth would pull the world’s third-largest economy out of its worst postwar recession, but analysts say a rapid recovery like that seen in China is unlikely.
“The economy likely rebounded sharply in July-September thanks to a steady pickup in exports and consumer spending recovery after the government lifted emergency status,” said Shinichiro Kobayashi, senior economist at Mitsubishi UFJ Research and Consulting.
“Although the economy has escaped from the worst period, the pace of recovery is slow as the economic activity remained low and capital spending continued to be weak.”
Private consumption, which accounts for more than half of Japan’s economy, was seen rising 5.1% for the quarter, the poll showed, after it fell 7.9% in April-June.
External demand – or exports minus imports – likely contributed 2.6 percentage point to GDP growth for the quarter, as global economic activity started to pick up with the easing of coronavirus lockdowns.
But capital spending was expected to have fallen 3.0% in the third quarter after a 4.7% drop in the previous quarter, according to the poll.
The Cabinet Office will announce GDP at 8:50 a.m. on Monday, Nov. 16 (2350 GMT, Sunday).
Core machinery orders, a highly volatile data series regarded as an indicator of capital spending in the coming six to nine months, likely fell 0.7% in September from the previous month, the poll found.
That would be the first fall in three months as firms kept their caution over business spending due to the pandemic.
The Cabinet Office will publish the machinery orders on Nov. 12.
Data on Friday showed Japan’s household spending slumped in September from a year earlier and real wages slid for the seventh straight month.
(Reporting by Kaori Kaneko; Editing by Kim Coghill)
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.
