According to the reports, enormous rise in exports have boosted Japan’s economy at a faster-than-expected rate in the last quarter. Gross domestic product surged at an annualized rate of 2.2% in the three months to September, the third successive quarter of growth.
As per official figures Japanese firms still remained dependent on overseas sales to make up for uninspiring local demand.
Meanwhile there are uncertainties that Donald Trump US presidency might hurt Japan if anti-free trade bombshell will get into reality. So far after the election result, the yen has plunged against the dollar. That makes Japanese merchandises cheaper abroad, which is good news for the country’s exporters.
The latest official data showed the world’s third-largest economy expanded by 0.5% compared with the three months to June – better than the forecast of 0.2% growth.
After long long time there is some good news for Prime Minister Shinzo Abe’s projects to help stimulate the economy, the project was called Abenomics.
Nevertheless, analysts think this pace could not be continued given Japan’s dependence on exports.
“Consumption is barely there, and in capital expenditure there no growth … so Japan is relying very much on the outside,” Takuji Okubo, chief economist of Japan Macro Advisers, told the BBC.
Moreover Kohei Iwahara, an economist at Natixis Japan Securities, said the figures could be a “one-off windfall”, forecasting a go-slow in the last three months of 2016.
Government’s cabinet most recently agreed an economic stimulus package worth more than 28 trillion yen ($275bn), Mr. Abe’s latest effort to boost growth through spending.
Nevertheless economists were largely dissatisfied with both its scope and likely impact.
Furthermore Japan’s central bank again pushed back the timeline for hitting its 2% inflation target to March 2019 – a move that elevated more questions about the country’s economic recovery.