Japanese economy crawls out of recession
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TOKYO (AFP) - Japan's economy limped out of recession in the last quarter of 2014, official data showed Monday, but annual growth was flat and the weaker-than-expected figures were likely to boost calls for more central bank stimulus.
The 0.6 per cent expansion in the world's number three economy between October and December follows two consecutive quarters of contraction that came as an April sales tax rise hammered consumer spending. Economists had expected 0.9 per cent growth.
However, over the full year the preliminary data showed zero growth, compared with 1.6 per cent expansion in 2013. Revised figures will be released in the following weeks.
By contrast, the US economy grew at its fastest pace in four years in 2014, expanding 2.4 per cent.
"While Japan's economy has finally left the tax-related weakness behind, the increase in (fourth-quarter gross domestic product) fell short of expectations and supports our view that the Bank of Japan will announce more stimulus in April," said Marcel Thieliant from Capital Economics.
"Today's result indicates that the Bank of Japan's view on growth is too optimistic, and we still believe that the Bank will announce more easing at the late-April meeting."
Last month, Japan's central bank slashed its inflation outlook as plunging oil prices dent efforts to end years of deflation.
But the bank -- which holds its next policy meeting this week -- held off expanding its massive monetary easing programme and boosted its growth forecasts, saying the economy would expand 2.1 per cent in the year to March 2016, up from an earlier 1.5 per cent forecast.
