- Japan’s Quarter 1 (qtr 1) Gross Domestic Product (GDP) beat estimates of 0.0% by 0.5%.
- USD/JPY pops 6 pips on the release.
Japan’s Quarter 1(qtr) GDP was not expected to impress today with a consensus of -0.1%qtr after +0.5%qtr in qtr 4. Consumption and business investment have been weak in qtr 1 – Analysts at Westpac argued that net exports should provide some offset, “partly due to soft import demand (not ideal)”. The analysts at Westpac also pointed out that, last week the government insisted that the sales tax increase planned for October would proceed.
Data arrived as follows:
- GDP (seasonally adjusted) for Q, preliminary, 0.5% q/q expected -0.1%, prior +0.5%.
- GDP Annualized (seasonally adjusted) for Q, preliminary % 2.1 y/y expected -0.2%, prior +1.9%.
- GDP Nominal (seasonally adjusted) for Q, preliminary 0.8% q/q expected 0.1%, prior 0.4%.
- GDP Deflator y/y for Q, preliminary 0.2% expected 0.2%, prior -0.3%.
- GDP Consumer Spending y/y for Q, preliminary 1% q/q, expected -0.2%, prior was 0.4%.
- GDP Business Spending y/y for Q, preliminary -0.3% q/q, expected -1.9%, prior was 2.5%, revised from 2.7%.
About the Gross Domestic Product (GDP)
GDP released by the Cabinet Office shows the monetary value of all the goods, services and structures produced in Japan within a given period of time. GDP is a gross measure of market activity because it indicates the pace at which the Japanese economy is growing or decreasing. A high reading or a better than expected number is seen as positive for the JPY, while a low reading is negative.
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