An escalation in Japan's nuclear crisis has failed to dissuade analysts from forecasting an economic rebound starting next quarter, an outlook that hinges on a recovery in business and household confidence.
Gross domestic product may shrink 3 percent in April-to-June, the most since the aftermath of the 2008 Lehman Brothers Holdings Inc. collapse, according to the median of 18 estimates in a Bloomberg News survey in the past week. The GDP loss will be more than recouped by year's end, with 1.9 percent and 5.5 percent annual growth rates in the final two quarters, the survey shows.
Prime Minister Naoto Kan's proposed ¥4 trillion initial reconstruction package may kick-start the recovery from last month's record earthquake. Companies from Shiseido Co. to convenience-store chain FamilyMart Co. are counting on a shift in sentiment to prompt households to open their wallets and limit the hit to corporate earnings.
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