TOKYO – The Japanese economy grew 1.4 percent year-on-year, and 0.3 percent quarter-on-quarter, between July and September, recording a seventh straight quarter of expansion as exports outperformed, according to data published by the Cabinet Office.
The figures slightly exceeded forecast by most analysts and is the longest period of sustained growth the country has recorded since the period between April 1999 and March 2001, when it witnessed growth for eight consecutive quarters.
During the April-June period, Japan’s GDP increased 2.5 percent year-on-year and 0.6 percent quarter-on-quarter.
The growth was propelled by solid performance of exports, although domestic consumption – another pillar of the Japanese economy – continued to weaken.
Exports, led by the electronic components and automobile sectors, rose by 1.5 percent quarter-on-quarter and 0.6 percent year-on-year.
Domestic spending, which accounts for nearly 60 percent of the Japanese GDP fell 0.5 percent, as compared to April-June, its first setback in seven quarters.
Consumer spending has remained low in the country against low wage increases and is a major challenge for the government and the Japanese central Bank (BoJ).
After Prime Minister Shinzo Abe had taken office toward the end of 2012, the government and the BoJ had initiated aggressive economic reforms, also known as Abenomics, monetary easing and huge public investments to pull the country out of chronic deflation.
However, these reforms are yet to generate a cycle of increments in corporate profits, salaries, consumption and inflation, despite recording encouraging GDP figures.
Corporate capital investment – another key element of the government’s economic strategy – grew 1.0 percent year-on-year and 0.2 percent quarter-on-quarter.
Public investment declined 2.5 percent quarter-on-quarter, the first slump in nine months owing mainly to huge government stimulus in this sector earlier.
In December, the government plans to adopt fresh measures to bolster growth, improve competitiveness and availability of labor, according to Economy Minister Toshimitsu Motegi on Wednesday.
The GDP figures come barely a month after Abe renewed his term as prime minister in snap elections, which he had justified over the need to expedite economic reforms.