"Japan's economy can emerge from recession in the first quarter as consumer spending and exports are expected to pick up"
- Yamamoto, senior economist at Mizuho Research Institute
Activity within the Japanese tertiary sector jumped unexpectedly in the last month of 2012, indicating that consumers are getting less anxious over the world's third largest economy's outlook. According to the Ministry of Economy, Trade and Industry, a gauge, which measures the domestic service sector in Japan, such as information and communication, electricity, gas heat and water, transport, wholesale and retail trade, climbed a seasonally adjusted 1.4% on month in December, after a 0.4% contraction in the preceding month. Latest data indicate that companies are showing willingness to increase their spending due to Shinzo Abe's pledge to introduce more bold measures in order to boost the economy.
"Japan's economy can emerge from recession in the first quarter as consumer spending and exports are expected to pick up," said Yasuo Yamamoto, senior economist at Mizuho Research Institute. "But in order for growth to accelerate even further, capital expenditure needs to improve. Unfortunately, capital expenditure is likely to remain weak."
"There have been signs of the economy bottoming out," Yoshiki Shinke, chief economist at Dai-Ichi Life Research Institute. "It would not be surprising to see the decline in the coincident index coming to a halt in the near term."
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