The government on Thursday slightly raised its economic growth projections for this fiscal year from its previous estimates, as external demand is likely to more than offset weak domestic consumption, the Cabinet Office said.

In the twice-yearly economic outlook, the real economic growth rate for fiscal 2023 ending in March 2024 is estimated at 1.6%, up from 1.3% seen half a year ago as external demand contributed 1.4 percentage points to overall growth, due to a recovery in inbound tourism and automobile output.

Auto manufacturing had been hit earlier by chip shortages.