Japan’s economy stages modest bounce from Covid-19 jitters
Japan's economy rebounded at a slower-than-expected pace in the second quarter from a Covid-induced slump, data showed on Monday, highlighting uncertainty on whether consumption will grow enough to bolster a much-delayed, fragile recovery.
A revival in Japan, like many other economies, has been hobbled by the Ukraine war and surging prices of commodities even as rising consumption propped up growth in April-June.
"Consumption and capital expenditure will continue to drive growth in July-September. But momentum may not be that strong as rising inflation is cooling household spending," said Atsushi Takeda, chief economist at Itochu Economic Research Institute.
"While domestic demand may continue to expand, falling exports could put a brake on Japan's recovery," he said.
Indeed, Japan's outlook has been clouded by a resurgence in Covid infections, slowing global growth, supply constraints and rising raw material prices that are boosting households' living costs.
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