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Japan’s GDP growth to pick up in Q4, then slow

TOKYO: Japan’s economy probably grew at its fastest pace in nearly two years in the fourth quarter of last year thanks to a recovery in capital expenditure, while energy price rises are likely to slow deflation, a Reuters poll shows. Gross domestic product (GDP) is forecast to have expanded 0.8 percent in the fourth quarter, quicker than 0.5 percent growth forecast in the January Reuters survey. The latest poll estimates, based on the median estimate of around 25 economists polled Feb. 5-9, come as lawmakers debate the government’s record $1 trillion budget for the fiscal year starting April 1. However, economists expect economic growth to slow to 0.2 percent in the first quarter of this year as domestic subsidies on energy-efficient goods run their course and as the government lowers spending on public works like bridges and dams. These were in line with the quarterly growth profile in the January poll. The economy is forecast to grow 0.2 percent in the first quarter according to the February survey, the same as was expected last month. The US economy grew at an annualised clip of 5.7 percent in the same quarter, while the eurozone economy expanded 0.1 percent on the quarter. reuters

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