Japan's April-June GDP growth rate revised upward

Sept. 9, 2013 at 6:26 AM   |   Comments

TOKYO, Sept. 9 (UPI) -- The Japanese government upwardly revised the country's April-June economic growth rate to an annualized 3.8 percent, the Cabinet Office reported.

Officials said the economy expanded 0.9 percent from the previous three months, instead of 0.6 percent quarter-to-quarter as was previously estimated. The earlier estimate, provided Aug. 12, translated to an annualized growth rate of 2.6 percent.

The faster growth rate should further encourage the government of Prime Minister Shinzo Abe to increase the sales tax next April to 8 percent from the current 5 percent, observers said.

The news came after it was announced that Tokyo would host the 2020 Summer Olympics, which would benefit the economy by giving a boost to tourism and the construction industries, Kyodo News reported.

There was a sharp upward revision in capital spending.

Business investment spending grew 1.3 percent.

Japan has also had higher exports and increased consumer spending, all critical to lift the economy out of 15 years of deflation.

"Corporate performance was confirmed to be improving as business investment turned positive," Mitsumaru Kumagai, chief economist at the Daiwa Institute of Research, told Kyodo.

"The April-June revised GDP data, considered a key indicator for a decision on the consumption tax hike, suggested it will be implemented as planned."

"I honestly think [the growth rate] was better than I expected ...The prime minister will make a judgment [on the tax matter], taking this into account," Chief Cabinet Secretary Yoshihide Suga told a news conference.

The new growth rate follows a 4.1 percent growth in the January-March quarter and 1.1 percent expansion in the last three months of last year.

Topics: Shinzo Abe
© 2013 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
Recommended UPI Stories
Featured UPI Collection
2014: The Year in Music [PHOTOS]

2014: The Year in Music [PHOTOS]

Most Popular
Texas, N.D. oil push imports down
Australia orders Supacat special operations vehicles
Scout attack helicopter demos firepower
Oil spill reported in North Dakota
Gulf of Mexico auction draws $100 million in bids
Trending News