TOKYO: Japan’s economic growth in the first three months of 2014 hit its fastest pace in more than two years, data showed yesterday, while analysts said a pick-up in consumer confidence indicated sentiment was improving despite the impact of a sales tax hike.
A surprise jump in capital spending powered the 1.6 percent expansion in the world’s
number-three economy between January and March, slightly better than an initial estimate of 1.5 percent.
It also marked the best quarterly advance since a 2.6 percent rebound several months after the 2011 quake-tsunami disaster.
Cash registers across Japan rang up big sales ahead of the April 1 consumption tax rise, a move seen as crucial to paying down a massive public debt but which critics warn could throw a nascent recovery off track.
Millions of shoppers scooped up everything from cars and refrigerators to televisions and
alcohol in a spending spree that resulted in a 6.7 percent annualised first-quarter expansion in the economy — a hypothetical figure that shows growth stretched over a full year.
However, consumers have since reined in their buying, with figures this month showing household spending down 13.3 percent in April while retail sales suffered a similar slump.AFP