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Oct-Dec 2015 2nd Preliminary GDP Estimate

Real GDP growth rate revised upwards slightly from 1st preliminary; results within range of expectations

Satoshi Osanai

Shunsuke Kobayashi

Summary

◆The real GDP growth rate for Oct-Dec 2015 (2nd preliminary est) was revised upwards slightly to -1.1% q/q annualized (-0.3% q/q) in comparison to the 1st preliminary report (-1.4% q/q annualized and -0.4% q/q). Results also exceeded market consensus due to the upward revision of capex, which was expected to be revised downwards on the 1st preliminary report, and the upward revision of inventory investment, which was seen marking time on the 1st preliminary report. All in all, these results confirmed our previous opinion that Japan’s economy was in a lull during the fourth quarter.


◆Performance by demand component in comparison to the 1st preliminary results shows personal consumption and public investment recording downward revisions, while inventory and capex achieved slight upward revisions, helping to increase overall results. Capex was revised upwards to +1.5% q/q in comparison to +1.4% on the 1st preliminary report due to corporate statistics. Meanwhile, inventory investment was revised upwards slightly to -0.0% pt q/q in comparison to -0.1% pt on the 1st preliminary report, exceeding market expectations at -0.1% pt.

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