Japan's economy expanded at a faster pace in the second quarter than initially reported, providing additional support for the central bank's expected decision to raise interest rates next week.
A report released by the Cabinet Office on Tuesday showed gross domestic product grew at an annualized rate of 1.4% in the April-to-June period, up from the preliminary reading of 1.1%. However, this figure fell short of the median economist forecast of 1.8%.
The upward revision was primarily driven by stronger business fixed investment, which declined by 0.9% quarter-on-quarter compared with the initial estimate of a 1.2% drop, following the incorporation of newly available data for the period.
These figures align with the central bank's assessment that economic activity is broadly tracking its projections, thereby reinforcing the rationale for policymakers to raise borrowing costs when they convene on September 18. Swap market pricing indicates that investors have fully priced in such a move at that meeting.
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