Japan’s economy rebounded in the fourth quarter of 2021 as the easing of restrictions related to the pandemic boosted consumer spending, data released by the Cabinet Office revealed on Tuesday.
Gross domestic product grew 1.3 percent sequentially, reversing a 0.7 percent fall in the third quarter. Economists had forecast a quarterly growth of 1.4 percent.
On an annualized basis, the economic growth came in at 5.4 percent in the fourth quarter, but weaker than the forecast of 5.8 percent.
The expenditure-side breakdown showed that the growth was largely driven by household spending and exports.
Private consumption gained 2.7 percent from the prior quarter, which was faster than the expected growth of 2.2 percent and reversed the 0.9 percent drop in the third quarter.
On the other hand, government spending decreased 0.3 percent after rising 1.1 percent a quarter ago.
Private residential investment was down 0.9 percent, while private non-residential investment grew 0.4 percent.
Exports of goods and services advanced 1 percent. Meanwhile, imports of goods and services were down 0.3 percent.
While Omicron will cause Japan’s economy to do little more than tread water this quarter following a rebound in the fourth quarter, output should soon resume its recovery and get back on its pre-virus trend by the end of the year, Tom Learmouth, an economist at Capital Economics, said.
In the whole year of 2021, GDP expanded 1.7 percent after contracting 4.5 percent in 2020 and 0.2 percent fall in 2019.
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