“Japan” cut its 67 growth forecast to 0.9%, inflation rose to 2.8%.

“Japan” cuts its 67 growth forecast to 0.9%, inflation rising to 2.8% due to weak private spending. Production halted by some automakers at the beginning of this year

On July 19, 2567, Bloomberg News reported that The Cabinet Office of Japan revealed that The Japanese government has lowered its real growth forecast for fiscal year 2567 to 0.9% from the previous estimate of 1.3%.

This reduction was due to weaker private sector spending. And besides inflation that continues Other specific factors It also has a weaker effect on spending. Including stopping production of some car manufacturing companies at the beginning of this year and the effects of the earthquake at the beginning of the year

Japan also raised its overall inflation forecast to 2.8% from 2.5% for this fiscal year. which reflects the latest currency trends The government currently expects the yen to stay around 158.8 yen per dollar for the current fiscal year. This was much weaker than the previous forecast of 149.8 yen, with the yen trading at a 38-year low for about a month. before recovering last week. After wondering if the government would intervene

Downgrading economic growth forecasts for the current fiscal year This reflects private consumption being weaker than expected. Such moves put pressure on Fumio Kishida Prime Minister of Japan ahead of the ruling party's presidential election in September. And for the Bank of Japan which is considering raising interest rates.

Recent opinion polls show that the prime minister's approval rating for his cabinet is below 30%, with no signs of improvement. One survey showed that voters did not find the Prime Minister's economic measures helpful in tackling inflation. This includes additional tax rebates and utility subsidies.

So far, no Liberal Democrat member has officially announced their intention to run for party leadership in the fall. By the results of a survey by All Nippon News Network conducted over the weekend. It shows that the majority supports Shigeru Ishiba at 27%, followed by Shinjiro Koizumi at 18%, and Kono Taro and two other members of parliament at 2%.

Moreover, the government's revised forecasts further complicate the central bank's situation. This is because the central bank is considering the possibility of raising interest rates again. About a third of BOJ observers expect the BOJ to announce a rate hike in July.

The Japanese government said in growth forecasts The government also presented its outlook for the next fiscal year for the first time. The economy is expected to grow demand-driven at 1.2%, supported by resilient private consumption and business investment.

refer : bloomberg.com

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