Japan staging economic revival
Published 14/11/2011 | 08:32
Japan's government said the economy expanded at a 6% annualised rate in the July-September quarter as the country staged a recovery from the devastating earthquake and tsunami in March.
The real gross domestic product reading marks the first expansion for the world's third-largest economy in four quarters.
The Japanese cabinet office said that the result translates to GDP growth of 1.5% from the previous quarter.
The March 11 earthquake and tsunami killed thousands of people and wiped out large swathes of Japan's north-eastern coast.
The disasters damaged many factories in the region, causing severe shortages of parts and components for manufacturers across the country, including carmakers. The tsunami also crippled a nuclear power plant, adding to the difficulties faced by businesses and households.
Since then, the country has steadily restored its factories, helping the economy rebound despite the threats of a financial crisis in Europe, a slowing global economy and a strong yen.
Consumer spending, which accounts for some 60% of the economy, climbed 1% from the previous quarter. Capital investment by companies rose 1.1%.
Analysts, however, say that the strong third quarter numbers are unlikely to last.
Credit Suisse economist Hiromichi Shirakawa said Japan had benefited from a sharp increase in exports and industrial production into the early summer. But the economy has "already lost upward momentum since August," he said in a report last week.
He expects Japan's economy to weaken in coming months and forecasts GDP to contract in the fourth quarter.