Japan's economy grows for two straight quarters


Capex -0.3% on quarter, consumption -0.1%.

With private consumption, the main pillar of domestic demand, staying sluggish however, a senior official of the Cabinet Office said, "The actual state of the economy may be worse than the growth number".

Some policymakers have called for a delay to the sales tax increase from 8% to 10% given a backdrop of uncertain domestic and global economic conditions.

It was the second successive expansion for the Japanese economy after growth of 0.4 per cent in the fourth quarter of past year and defied gloomy expectations by analysts who predicted a small decline at the start of 2019.

In nominal terms, January-March GDP rose 0.8 percent for an annualized increase of 3.3 percent, also growing for two consecutive quarters.

For fiscal year 2018, the economy here expanded 0.6 percent in real terms. Spending on clothing slumped due in part to relatively warm winter weather, while expenditures on automobiles showed limited growth.

Japan, which now enjoys such full employment that it is importing overseas labor, still suffers from weak wage growth, and in Q1 private consumption slid 0.1%. This compares with a 1.9 percent expansion logged for fiscal 2017, the government's data showed.

Housing investment climbed 1.1 percent to mark the third straight quarter of growth.

Officials at Japan's Cabinet Office released the latest figures on Monday.

The report found Japan's exports had decreased by 2.4 percent, the steepest decline since 2015.

Imports fell at a faster pace, at 4.6 percent, as purchases of crude oil and natural gas decreased on the back of slowing domestic demand. However, Japan's imports and exports declined over the same period alongside household spending and capital investment.

Japan's economy grew at an annualized rate of 2.1% in the first quarter, accelerating slightly from the previous quarter's growth, backed by net exports growth, according to Reuters.

"I still think that the economy is in a soft patch and risks are on the downside, with high uncertainties over China's economy and its trade war with the us", said Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute.