Healthy Gdp Growth

Japans gross domestic product (GDP) total output of goods and services minus net income from overseas production rose a real 1.6 per cent in the January-March quarter from the previous quarter, or an annualised 6.6 per cent. This compared with a revised real quarter-on-quarter GDP rise of 0.9 per cent for the October-December quarter.

In fiscal 1996/97, the nations GDP, a closely watched pointer to the health of the economy, rose a real 3.0 per cent from the previous year after a revised figure of 2.4 per cent growth in 1995/96, the Economic Planning Agency (EPA) said. The figures for quarterly and fiscal year growth were at the top end of economists forecasts, which had, on average, predicted that real GDP for the January-March period would grow 1.1 per cent from the previous quarter. Their forecasts for GDP growth for the full fiscal year ranged from 2.7 per cent to 3.0 per cent. Reuter

Although the data confirmed that the economy has been improving, economists said the real focus was on the picture after a tax rise which took effect on April 1. The looming rise in the national consumption tax was the main factor behind the strong consumption in the January-March period, as consumers rushed to buy goods before the tax increase.