Oct-Dec 2022 2nd Preliminary GDP Estimate

◆The real GDP growth rate for Oct-Dec 2022 (2nd preliminary estimate) was revised downwards to +0.1% q/q annualized (+0.0% q/q), in comparison to the 1st preliminary results, which were at +0.6% q/q annualized. This was due mainly to a downward revision of personal consumption, reflecting the Financial Statements Statistics of Corporations by Industry released on March 2 and the December results of other fundamental statistics. Real GDP attained slightly positive growth, partly due to a decline in private sector inventories, but this could possibly be an "unintended inventory decline" reflecting increased economic activity. Personal consumption increased despite the spread of COVID-19 and high prices, and exports also increased. In reality, the economic recovery trend is stronger than the GDP growth rate indicates.

◆The 2023 Jan-Mar period real GDP growth rate is expected to be at +3.3% q/q annualized. The COVID-19 infection situation is improving, and supply constraints in the motor vehicle industry are expected to ease further. Personal consumption will likely continue to recover with the effects of the government’s measures to curb high energy prices. Capital expenditure is expected to achieve growth centering on the non-manufacturing industry, and while the export of goods is growing at a sluggish pace, service exports are expected to register further growth with the help of inbound consumption.