Browse > Home / Business, Capital Spending, Economic Reports, Economics, GDP, Ministry of Finance / Capital spending down 1.2% in July-September quarter; GDP to be revised upward?

Capital spending down 1.2% in July-September quarter; GDP to be revised upward?

December 3, 2007
By Ken Worsley


Earlier today, the Ministry of Finance reported that capital spending had fallen 1.2 percent during the July-September quarter. Following a 4.9 percent fall in the April-June quarter, this is the second consecutive quarter with a fall in capital spending.

According to the Ministry’s results, profit fell 0.7 percent at the firms surveyed. This was the first fall reported in five years.

Bloomberg, however, says that the fall is less than the 2.5 percent that had been predicted by its survey of economists. We also see the warning that risk is developing over Japan’s continued reliance on exports and the health of external markets.

Export growth to Asia has been particularly visible this year, making up for some of the loss that might have resulted from a dropoff in exports to the United States. The question now is whether Asian economies are healthy enough in order to keep growing at a sustained pace and continue with their demand for Japanese products.

Despite the negative news on capital spending, Reuters tells us that its survey of economists predicts a slight upward revision in Japan’s GDP figures for the second quarter. Preliminary figures from the Cabinet Office put second quarter GDP growth at 0.6%, for an annualized rate of 2.6%. The Reuters survey expects to see that revised upward to 0.7% quarterly and 2.7% annually.

The revised figures are set to be released just before 9am on Friday.

Filed Under Business, Capital Spending, Economic Reports, Economics, GDP, Ministry of Finance 

Social Bookmarks:
del.icio.us:Capital spending down 1.2% in July-September quarter; GDP to be revised upward? digg:Capital spending down 1.2% in July-September quarter; GDP to be revised upward? newsvine:Capital spending down 1.2% in July-September quarter; GDP to be revised upward? furl:Capital spending down 1.2% in July-September quarter; GDP to be revised upward? reddit:Capital spending down 1.2% in July-September quarter; GDP to be revised upward?
Related Posts:
Japan’s GDP fell 0.3% in April-June Quarter: Revised Cabinet Office Statistics
Nikkei: April-June GDP to be Revised Downward
Capital Spending Down 4.9% in the April-June Quarter
Capital Spending Marks its 16th Consecutive Quarter of Increase; Corporate Profits Up
GDP up 0.9% in September-December quarter, exceeding all expectations except one

Comments

3 Responses to “Capital spending down 1.2% in July-September quarter; GDP to be revised upward?”

  1. Paul on December 5th, 2007 5:02 am

    I’m betting on the revised figures to be down, though a greater share may be seen from exports. Domestic and capital spending just haven’t been there, and the drop in housing starts has to hurt. The rise in auto sales came from October, so September should still see negative domestic rates.

  2. WG on December 7th, 2007 11:27 am

    So it’s announced that GDP was revised down to 1.5%. There’s really not much point in listening to what the media comes up with these days, is there?

  3. Ken Worsley on December 7th, 2007 1:41 pm

    WG, Yes and no. No doubt, Bloomberg’s forecasts of economists are a useful tool. They’re generally close unless there’s some reason the final number is wildly off. There are definitely some sources worth listening to, but this Reuters projection is a clear case of needing to know when to have the information to protect yourself from these sorts of errors. Anyone looking at the data knew it wasn’t possible.

Got something to say?