Apr-Jun 2023 2nd Preliminary GDP Estimate

◆The real GDP growth rate for Apr-Jun 2023 (2nd preliminary est) was revised downwards to +4.8% q/q annualized from the 1st preliminary results, which were at +6.0% q/q annualized. This was due mainly to the Apr-Jun period Survey of Corporate Statistics issued on September 1, and other fundamental statistics which reflected June results. While net exports brought a major boost to the GDP growth rate, private sector demand components such as personal consumption and capital expenditure were sluggish, hence performance was not as good as the GDP growth rate suggests.

◆The 2023 Jul-Sep period real GDP growth rate is expected to be at around -0.5% q/q annualized. The major factor here is an expected reactionary decline in comparison to the Apr-Jun period, while at the same time domestic demand is expected to move into a recovery phase. Widespread wage hikes and lower inflation rate will boost real wages and contribute to a recovery in personal consumption. Recovery production in motor vehicles as was seen in the Apr-Jun period is expected to continue in the Jul-Sep period. On the other hand, downside risk to exports due to the deterioration of overseas economies remains a concern.