Japanese economy to expand 2.2%
Japan's economy will expand 2.2% in the fiscal year starting in April, the Government said yesterday, as housing investment picks up after this year's devastating earthquake and as subsidies spur consumption and capital expenditure.
The Cabinet said it expects the economy to shrink 0.1% in the fiscal year through March 2012.
The Government had previously forecast the economy to grow 0.5% in the current fiscal year and 2.8% in the year through March 2013.
It lowered its economic growth forecasts as the country struggles with the yen's export-sapping strength and the fallout from Europe's debt crisis. It said unemployment would fall to 4.3% from the 4.5% projected for this year.
The Cabinet Office issues economic forecasts in December for the following fiscal year, and its figures provide the basis for the Government to compile its annual budget.
The Government expects market turbulence from Europe's sovereign debt crisis to subside next year and for exports to recover.
It is also more optimistic than some economists on Japan's domestic demand.