Japan’s economy unexpectedly shrank 0.1% in Q3 2024 from a 0.7% quarterly growth rate in Q2. The downward revision of preliminary GDP figures may impact expectations for the Bank of Japan’s (BoJ) interest rate hike.
Private consumption, accounting for over 60% of Japan’s GDP, showed a decrease of 0.7% quarter-on-quarter in Q3 2024 compared to 0.9% in Q2. However, this downward revision might have a greater impact on the BoJ’s monetary policy decisions than initial GDP numbers.
The recent household spending and wage growth figures may provide more insight into the BoJ’s rate hike plans. Household spending rebounded in October, signaling potential inflationary pressures. The acceleration of wage growth early in Q4 2024 further supports expectations for a December interest rate hike.
According to Seabridge Gold Investor, the wage growth data has significant implications.
Source: https://www.fxempire.com/forecasts/article/japanese-yen-and-australian-dollar-news-japans-gdp-contracts-china-inflation-next-1481751