Japan economy picks up pace in wobbly recovery

Japan's economy grew more than expected in the first quarter, data showed Wednesday, as it crawls back from a brief recession, but observers cautioned that a full recovery may still be some way off.

The 0.6 percent on-quarter expansion was bigger than revised 0.3 percent growth in the last three months of 2014, and beat market expectations for a 0.4 percent rise.

In annualised terms, the world's number three economy expanded 2.4 percent January-March as capital spending and the housing market showed signs of strength, although exports dipped slightly and consumer spending was weak.

The relatively upbeat figures -- outpacing a lacklustre 0.2 percent annualised rise in the US economy during the same period -- may cool expectations of imminent stimulus from the Bank of Japan (BoJ), after a sales tax rise last year hammered consumer spending.

The sales levy hike -- Japan's first in 17 years -- plunged the economy into recession and threw Prime Minister Shinzo Abe's growth-boosting programme, dubbed Abenomics, into question.

Investors embraced Wednesday's growth figures, pushing the benchmark Nikkei 225 index up 0.85 percent to a fresh 15-year high of 20,196.56, as Japan wraps up its latest earnings season with many firms reporting strong profits, largely owing to a weak yen.