Japanese economy could expand 1.3% in 2017 – UOB

In light of the recent GDP figures in Japan, strategists at UOB Group now sees the economy growing at an annualized 1.3% this year.

Key Quotes

“We initially expected 2017 GDP growth to be at 0.9%, comparable to the growth achieved in 2016 (+1.0%) and 2015 (+1.1%). But with the surprisingly robust 1H 2017 growth outturn, even if we pencil in a moderate technical recession for Japan in 2H (i.e. two sequentially q/q declines), growth is still expected to come in above 1%”.

“As such, we revise our 2017 GDP growth higher to 1.3% even after factoring declines of 2.2%q/q SAAR in 3Q and -1.3%q/q SAAR in 4Q”.

“Again, the key risks ahead for Japan remains to be geo-politics, from Trump’s US economic & foreign policy to the on-going developments in the Korean Peninsula, which may hamper business investment & trade outlook. We also keep a close eye on Japanese domestic politics as a near term risk to outlook”.