The watchword, for the moment, is still Abenomics. And nobody wants to question, in the parts of the archipelago, the strategy of relaunching the economy of the Japanese premier Shinzo Abe. Finance Minister Akira Amari was keen to underline the positive aspects of the latest quarterly statistics. "Domestic demand is solid and the economy continues to recover," Amari cut short, underlining that Tokyo achieved its fourth consecutive quarter of growth in the July-September period. According to the minister, the brutal slowdown in the pace of GDP growth, which went from 3,8% in April-June to 1,9% in the last three months, is just a hiccup due to the external situation which does not call into question Abe's economic policy.
Experts underline that the data released this morning highlight the difficult awakening of internal activities, on which the prime minister is aiming to revitalize the country. After taking office in December 2012, Abe promised to lift Japan out of deflation.
According to him, the prospect of a rise in prices should incite companies to invest in new plants and new talent. There will thus be a relaunch of activities, an increase in wages and the virtuous circle will fuel the growth of the world's third largest economy for years.
For the moment, however, Abenomics has not brought all the hoped-for results. The plan for major works, launched in February, worked and public investments seem to have made a good contribution to growth in the June-September period. But monetary policy, focused on a spectacular quantitative easing programme, did not have the expected positive outcome.
The yen lost 20% against the dollar and the euro, but exports didn't profit. In the last quarter, exports recorded a -0,6%. Over the same period, imports increased by 2,2% and the weak yen drove up the costs of all raw material and food orders.
Domestic consumption, which generates 60% of GDP, grew by a modest 0,1% in the quarter. Driven by the richest families who took advantage of the financial situation in the first half, domestic demand had seen a rise of 0,6% between April and June.
The Tokyo Stock Exchange is stagnant. Investors are awaiting Abe's next moves, as he is now trying to pass numerous structural reforms through Parliament.
Pending further developments, Japanese companies remain cautious and do not raise wages or launch new investments.
