Japan’s economy expanded at a faster pace than initially estimated as businesses ramped up spending, a largely positive development for Prime Minister Fumio Kishida amid ongoing speculation he may call an early election.
Gross domestic product grew at an annualized 2.7% in the January-March quarter from the previous three months, revised figures from the Cabinet Office showed Thursday. That beat both an initial reading of 1.6% and the 1.9% expansion forecast by economists. The revised data also showed that Japan avoided a technical recession at the end of last year.
The stronger corporate investment suggested sentiment among companies remained resilient despite concerns over a slowdown in the global economy. In less positive news, the growth figures gained a flattering boost from swelling inventories that point to demand not keeping up with production, a cause for concern going ahead. Consumer spending also proved a touch softer than first estimated.
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