Story thread · 2 reports / 2 sources

Japan Q2 GDP growth undershoots forecasts, complicating BOJ's hike timeline

investinglive.com · 1h · first reportShare

Japan Q2 real GDP prelim +0.3% q/q vs. expected +0.5% Japan Q2 GDP annualised +1.1% vs. expected +2.0% Japan Q2 GDP deflator +2.6% y/y Japan Q2 domestic demand contribution to GDP -0.2% Japan Q2 external demand contribution to GDP +0.5% vs. expected +0.3 Japan Q2 exports +0.5% q/q Japan Q2 private consumption 0.0% q/q vs. expected +0.5% Japan Q2 capex -1.2% q/q vs. expected +0.4% --- A GDP print this far below expectations complicates the Bank of Japan's path toward further policy normalisation, given the central bank has been leaning on steady domestic demand to justify additional rate hikes after moving away from ultra-easy policy. Flat private consumption and a sharp capex contraction point to a private sector still hesitant to spend, which could see the BOJ tread more cautiously into its next meeting even as elevated producer and consumer inflation keep pressure on policymakers to act. The yen is likely to come under renewed pressure on a weaker growth outlook, particularly if mark