Japan Beats Contraction Estimates But Corporate Spending Still Low

Japan’s economy shrank less than expected in the second quarter, although capital expenditure fell more than originally forecast, revised data showed.

The data is expected to keep policymakers under pressure to do more to energize the fragile recovery.

Prime Minister Shinzo Abe on Tuesday won a rare second term as leader of the Liberal Democratic Party, and thus as premier. Ahead of the party poll he released a statement in which he pledged to keep the economy as his prime focus.

Analysts expect any rebound in July-September growth to be feeble as factory output unexpectedly fell in July and China’s slowdown dampened prospects for a solid recovery in exports, Reuters reported.

The world’s third-largest economy shrank an annualized 1.2 percent in April-June, less than the initial estimate of a 1.6 percent contraction, Cabinet Office data showed on Tuesday. The median market forecast was a revision to a 1.8 percent contraction.

via CNBC

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