16 Nov 2015
Japan falls into technical recession – TDS
FXStreet (Delhi) – Prashant Newnaha, Rates Strategist at TD Securities, notes that the Japanese Q3 GDP dropped 0.2%/qtr, below the –0.1%/qtr decline the market had pencilled in, the 2nd straight contraction, in other words Japan is in a technical recession.
Key Quotes
“Q2 was revised up slightly (from –0.3% to –0.2%) and consumer spending rose 0.5%, the negative was the sharper drop in business investment, -1.3%/qtr vs –0.5% f/c.”
“Today’s data lifts the risk that the current fiscal year GDP will miss the 1.2% target projected by the BoJ at its meeting at the end of last month. A widening in the output gap which should see inflation pressures ease does lift the risk that the BoJ could inject monetary stimulus next year.”
Key Quotes
“Q2 was revised up slightly (from –0.3% to –0.2%) and consumer spending rose 0.5%, the negative was the sharper drop in business investment, -1.3%/qtr vs –0.5% f/c.”
“Today’s data lifts the risk that the current fiscal year GDP will miss the 1.2% target projected by the BoJ at its meeting at the end of last month. A widening in the output gap which should see inflation pressures ease does lift the risk that the BoJ could inject monetary stimulus next year.”