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Japan expects real 1.5% growth in fiscal 2015

13 Comments
By Takaya Yamaguchi

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For fiscal 2014, which ends in March, the government expects the economy to contract a real 0.5%, which is a downgrade from its previous forecast for 1.2% real growth, as consumer spending slumped.

So they projected 1.2% growth in 2014, but looks like it will actually decline by .5%, because consumer spending took a dive. But, we are supposed to believe the 1.5% growth projection for 2015, based on a rise in consumer spending. Not sure I'd bet the ranch on that projection.

-3 ( +5 / -8 )

Many economists say Japan returned to growth toward the end of last year as exports and corporate investment picked up.

So as mentioned yesterday the economy is improving.

But the pessimists still want it to be declining don't they jerseyboy,

Is the glass half empty or half full?

-4 ( +2 / -6 )

But the pessimists still want it to be declining don't they jerseyboy

StormR --actually we are the realists. All I am doing is stating EXACTLY what the government is projecting -- a decline of .5% for 2014. But, so you have a more balanced view, you might want to base your opinion on more than what you read on JT. For example I read an interview today with one of the key Saudi leaders involved with the oil industry, and he stated that they project Japan to be flat for 2015. And that is because the drop in oil prices will not impact the average Japanese consumer as directly as say American ones, since most Japanese commute by mass transit, which is not lowering prices, where the average American consumer will see an extra few hundred dollars in their pockets from lower gas prices. But if you want to get excited about 1.5% growth, go for it. Just shows how low expectations have become for the Japanese economy, even among its biggest fans, like you.

-5 ( +4 / -9 )

Jerseyboy not so excited as you think but any improvement is better than a decline, by the way I use many sources to form my opinions and views aside from the mostly left wing negative news and views one reads on here continuously.

I unlike most on here hope things do improve, I know lots on here want to see it disintegrate though.

-3 ( +3 / -6 )

I unlike most on here hope things do improve,

StormR -- For the benefit of my friends still in Japan, I hope things improve as well. My point is not that things will not improve. It is simply that anyone relying on the same guys who got caught totally blind-sided by the recession last year, to accurately project the future performance, are, IMO, not optimists, but simply cheerleaders. There is way too much politics and attempted psychology involved in Japanese government projections for me.

-2 ( +5 / -7 )

Japan’s government expects the economy to grow 1.5% in fiscal 2015 after adjustments for price moves, a slight upgrade from its previous forecast, due to an expected acceleration in consumer spending.

I'd like to know how an acceleration in consumer spending is going to happen. Sure, people will continue to spend whatever discretionary income they have, but, how are they going to spend more?

There's no incentive for consumers to spend more than they already do. No tax cuts, no significant wage hikes in the offing. It seems like the Japanese government is betting on consumers to make its policies work.

2 ( +3 / -1 )

Seems like wishful thinking not based on facts. The only facts we will have will be when it turns to 2016, so take notes on this and campare them then.

1 ( +2 / -1 )

Many economists say Japan returned to growth toward the end of last year as exports and corporate investment picked up.

Who do they mean by "many"? Q3 results were awful, Q4 probably saw a fraction of a percent in growth. Corporate investment has indeed picked up, as Japanese companies have merged with, or acquired interests (Suntory, Ajinomoto, et al) in foreign companies. This does Japan no good, as these investments are not being made in Japan, most profit and tax revenue will remain outside Japan. Sharp, which last year saw a spark of profit, looks set to return to the "loss producing" category which more than two-thirds of Japanese belong to.

The poplulation declined a further 268,000 last year, which means there are that many fewer consumers of Japanese goods. Hard to imagine any growth occurring in such an environment.

-1 ( +3 / -4 )

Some J companies are announcing that they are moving some of their manufacturing plants to Japan mostly from China, which is good news too.

-1 ( +2 / -3 )

@Tina,

Which companies are they? I appreciate such companies, but a list would be good. Maybe you are right.

0 ( +0 / -0 )

These are times of turmoil in global economy. So there is no cause for much for if growth rate is a little less that expectations or forecasts. The agencies concerned in Japan may however like to visit this writer's monumental predictions of 2 June 2014 in article - Stressful times ahead for global economy in 2015 and 2016 - published online at www.astrologyweekly.com. Certain suggestion may be had from the article for guidance because so far the predictions have come precisely accurate. It may however be mentioned here that these forecasts of likely trends are indicative and not deterministic because in human affairs or happenings, there is always room for reform, salvaging and improvement through a renewed , sufficient and appropriate strategy.

-1 ( +0 / -1 )

bruinfan

Honda, Sharp, Panasonic, TDK, Daikin, Nissan, etc. are moving their factories for Japan market to Japan.

3 ( +4 / -1 )

OK, thanks for the list. This gives me a springboard to look into.

0 ( +0 / -0 )

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