The economy is projected to have grown by an average of 0.5 percent in the July-September quarter compared with the previous quarter, according to eight major private-sector think tanks.
The growth in gross domestic product would mark a second straight quarter-on-quarter rise and translate into an annualized expansion of 1.9 percent, the think tanks said.
Most of the think tanks believe that exports, one of the factors capable of sparking economic growth, will have slowed in the quarter after serving as Japan’s sole driving force for months.
But the think tanks also expect to see quarter-on-quarter pickups in personal consumption and corporate capital investment that will more than offset the negative impact of any dropoff in exports.
The eight are NLI Research Institute, Dai-ichi Life Research Institute, Nomura Research Institute, Daiwa Institute of Research, Mizuho Research Institute, Japan Research Institute, UFJ Institute, and BNP Paribas.
Those bullish on personal spending attributed their projections to higher spending on entertainment during a pair of three-day holidays in September and what they described as brighter consumer psychology.
Seven of the eight anticipate that capital outlays on new equipment and factories will have grown due to the aftereffects of the expansion in exports and industrial output from the preceding months.
But all forecast that exports will have taken either mild or steep falls compared with the preceding quarter due to a temporary drop in overseas demand for Japanese goods.
Most of the predictions indicate that personal consumption has replaced exports as the engine of the economy.
However, an analyst at NLI Research Institute, an arm of Nippon Life Insurance Co., said, “The personal consumption picture is hounded by the fear that an acceleration of bad-loan disposal will splash cold water on consumer psychology.
“It is a fact that corporate capital investments have shown signs of rebounding, but their ability to bounce back has remained fragile,” the analyst said.
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