Express
DBS Bank: Japanese GDP Growth Likely to Remain Weak
Summary: According to sources, Japan's second-quarter GDP data will be released on Friday, as reported by Jinshi. DBS Bank's economic team predicts that Japan's second-quarter GDP growth rate may hover around 0%. They forecast that the seasonally adjusted annualized growth rate will modestly increase by 0.2%, just enough to offset the contraction in the first quarter. ...
According to sources, Japan's second-quarter GDP data will be released on Friday, as reported by Jinshi. DBS Bank's economic team predicts that Japan's second-quarter GDP growth rate may hover around 0%. They forecast that the seasonally adjusted annualized growth rate will modestly increase by 0.2%, just enough to offset the contraction in the first quarter. The weakening momentum in exports in the second quarter is attributed to a decline in exports to the US and soft overseas demand.
Domestically, private consumption remains subdued as wage growth lags behind inflation. The persistently weak GDP indicates that the Bank of Japan is unlikely to raise interest rates in the short term. Despite the trade agreement reached with the US helping to alleviate tariff uncertainties, the Bank of Japan may want to see stronger wage growth and stable inflation before resuming policy normalization. Therefore, DBS Bank maintains its forecast of a 25 basis point rate hike by the Bank of Japan in the fourth quarter.
