Forecast updates

▶ Our forecast for Japan’s real GDP growth in 2021 Q2 is an annualized +0.4%.

▶ We forecast a GDP deflator of -0.6% QoQ in 2021 Q2.

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Forecast updates

▶ Our forecast for Japan’s real GDP growth in 2021 Q2 is an annualized -1.1%.

▶ We forecast a GDP deflator of -0.6% QoQ in 2021 Q2.

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Forecast updates

▶ Our forecast for Japan’s real GDP growth in 2021 Q2 is an annualized +0.7%.

▶ We forecast a GDP deflator of -0.9% QoQ in 2021 Q2.

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Rising hopes that vaccination will be a game changer
– Real GDP expected to grow +3.4% in FY 2021 and 2.3% in FY 2022 –

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Forecast updates

▶ Our forecast for Japan’s real GDP growth in 2021 Q1 is an annualized -4.7%.

▶ We forecast a GDP deflator of -0.3% QoQ in 2021 Q1.

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Forecast updates

▶ Our forecast for Japan’s real GDP growth in 2021 Q1 is an annualized -7.5%.

▶ We forecast a GDP deflator of -0.3% QoQ in 2021 Q1.

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Recovery from double-dip recession expected in the second half of 2021 as vaccination unfolds.
Real GDP projections: -4.8% in FY 2020, +3.4% in FY 2021, +1.8% in FY 2022.

Forecast updates

▶ Our forecast for Japan’s real GDP growth in 2021 Q1 is an annualized -1.8% QoQ.

▶ We forecast a GDP deflator of -0.1% QoQ in 2021 Q1.

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Forecast updates

▶ Our forecast for Japan’s real GDP growth in 2020 Q4 is an annualized +12.8% QoQ.

▶ We forecast a GDP deflator of -0.4% QoQ in 2020 Q4.

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Forecast updates

▶ Our forecast for Japan’s real GDP growth in 2020 Q4 is an annualized +11.7% QoQ.

▶ We forecast a GDP deflator of -0.4% QoQ in 2020 Q4.

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Forecasts updates
▶ Our latest forecast for Japan’s real GDP growth in 2020 Q3 is an annualized +18.9% QoQ.

▶ We forecast a GDP deflator of -0.2% QoQ in 2020 Q3.

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Forecasts updates
▶ Our latest forecast for Japan’s real GDP growth in 2020 Q3 is an annualized +12.4% QoQ.

▶ We forecast a PCE deflator of +0.3% QoQ in 2020 Q3. In contrast, our GDP deflator forecast is -0.1% QoQ, reflecting the deteriorating terms of trade.

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Forecasts updates
▶ Our latest forecast for Japan’s real GDP growth in 2020 Q3 is an annualized +13.6% QoQ.

▶ Our latest inflation forecast (GDP deflator) for 2020 Q3 is +0.1% QoQ.

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Forecasts updates
▶ Our latest forecast for Japan’s real GDP growth in 2020 Q2 is an annualized -25.4% QoQ.
▶ We forecast an overall Q2 GDP deflator of +1.1% QoQ.

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Forecasts updates
▶ Our latest expenditure-side forecast for Japan’s real GDP growth in 2020 Q2 is an annualized -25.0% QoQ. Our production-side forecast is an annualized -19.3% QoQ. The average of the two is an annualized -22.1%.
▶ Our forecasts for the private final consumption expenditure deflator and the domestic demand deflator in 2020 Q1 are respectively -0.2% QoQ and -0.3% QoQ. As the terms of trade have improved substantially, we forecast an overall Q2 GDP deflator of +1.2% QoQ.

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V-shaped recovery unlikely following the Covid-19 pandemic -Social distancing measures to slow down recovery-

▶　Japan’s 2020 Q1 real GDP growth was an annualized -3.4% QoQ, the second consecutive quarter in negative territory.

▶　We expect an even steeper slump in private consumption in 2020 Q2, due to the government’s state of emergency declaration in April.

▶　As social distancing is expected to continue even after the state of emergency is lifted, a swift (V-shaped) recovery in production and consumption seems rather unlikely.

▶　We have updated our forecast for real GDP growth to -5.6% in FY 2020. After two years of negative growth in FY 2019 and FY 2020, we forecast a positive growth of +2.5% in FY 2021.

▶　We forecast a core CPI inflation of -0.4% in FY 2020, and +0.4% in FY 2021. This forecast reflects stagnant domestic and external demand, as well as the combined impact of the decline in gasoline prices, the government’s free childcare program, and the partial or complete elimination of tertiary education fees announced in April this year, which will all exert substantial deflationary pressure.

Forecasts updates
▶ Our latest expenditure-side　forecast for Japan’s real GDP growth in 2020 Q2 is an annualized -14.6% QoQ. Our production-side forecast is an annualized -7.4% QoQ. The average of the two is an annualized -11.0%.
▶ Our forecasts for the private final consumption expenditure deflator and the domestic demand deflator in 2020 Q1 are both -0.3% QoQ. However, as the terms of trade are improving, we forecast an overall GDP deflator of +0.7% QoQ.

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Forecasts updates
▶ Our latest expenditure-side forecast for Japan’s real GDP growth in 2020 Q1is an annualized -2.7%. Our production-side forecast is an annualized +0.3%. The average of the two forecasts is an annualized -1.2%.
▶ Our forecasts for the private final consumption expenditure deflator and the domestic demand deflator in 2020 Q1 are both +0.1% QoQ. As the terms of trade are deteriorating, we forecast an overall GDP deflator of 0.0% QoQ.

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Data updates

▶ Although production increased for the third consecutive month in February, its recovery from the October-November slump has been sluggish.
▶ Spending on goods (40% of total private final consumption expenditure) increased in February. However, statistics on spending on services, which have more weight and might have been affected substantially by Covid-19, have not been released yet, making it hard to draw conclusions on private consumption trends.
▶ Private housing, private capital investment and changes in private inventories were all bearish in 2020 Q1.
▶ February imports were hit particularly hard by Covid-19. That caused an abrupt expansion in net exports, which propped up GDP growth. However, as the global economy entered a synchronized slowdown in March, we expect that exports will decline, which will worsen the trade balance.

2020 Q1 Forecasts
▶ Our forecast for 2020 Q1 real GDP growth is an annualized -0.2% QoQ.
▶ However, real total demand growth (i.e. domestic demand plus imports) is an annualized -4.8%.
▶ We forecast an overall GDP deflator of -0.1% QoQ in 2020 Q1.