Japanese economy likely expand sequentially in Q1, expected to grow 1.2 pct in 2017 – Wells Fargo

Japan is set to release its first quarter economic growth data next week. According to a Wells Fargo research report, the Japanese economy is likely to have grown 0.4 percent on a quarter-on-quarter basis, while it is expected to have expanded 1.8 percent at an annualized rate. This might be a rebound from the 0.3 percent sequential growth rate and 1.2 percent annualized rate recorded in the fourth quarter of last year.

Economic growth seems to be bolstering to start this year, owing to a relatively weak yen and a robust global demand that assist the country’s vital export sector. In March, exports grew 12 percent, the most rapid pace seen in more than two years, coming at the heels of 11.3 percent rise in February, stated Wells Fargo.

In the first quarter, Japan’s Tankan index for large manufacturers grew to its highest level since the fourth quarter of 2015. Furthermore, the Bank of Japan’s accommodative monetary policy appears to be underpinning economic activity.

“We expect the Japanese economy to expand 1.2 percent in 2017, in-line with the consensus expectation”, added Wells Fargo.