The Strategist

Japanese government raises growth forecast for the new year

12/22/2022 - 09:35

The Japanese government raised its forecast for economic growth in the next fiscal year on Thursday, citing higher growth in corporate spending and earnings to support consumption.

The new forecast, which is being used to prepare the government's draft budget, assumes that Japan will be able to overcome the problem of a slowing global economy due to strong domestic demand and the opening of borders to tourists. The draft budget for the next fiscal year will be presented on Friday.

"Private sector demand will be the driver of growth in fiscal 2023," the government said in a statement, which also mentioned downside risks associated with downturns in other economies, high inflation, supply tensions, and market volatility.

Japan's real GDP will grow by 1.5% in the fiscal year beginning in April 2023, according to the new forecast. The previous forecast, published in July, predicted only 1.1% GDP growth.

Reuters polled analysts expect Japan's GDP to grow by 1.1% in fiscal 2023.