Japan’s govt to declare end of economic expansion dating from December 2012

Japan parliament. Photo: Kyodo. Sketched by the Pan Pacific Agency.

TOKYO, Jul 23, 2020, Jiji Press. The Cabinet Office is seen declaring the end of the economy’s latest expansion from December 2012, when Prime Minister Shinzo Abe returned to power, it was learned Wednesday, The Japan Times.

An expert group at the Cabinet Office is likely to date the most recent peak in the business cycle at October 2018. This would mean that the expansion lasted 71 months, the second-longest since the end of the war, after the 73-month boom that ended in February 2008.

The start of the latest expansionary phase coincided with the launch of Abe’s second administration. Its three-pronged reflationist policy mix called Abenomics featured massive monetary easing, which helped push down the yen while boosting stock prices, supporting the economy.

But the expansion lacked vigor. The average annual growth rate during the period stood below 2 percent.

In October 2018, Japanese exports and production were faltering in line with a global economic slowdown prompted by an intensifying trade spat between the United States and China.

The economy was also hurt by a consumption tax hike in October 2019 and a slump in global economic activity caused by the novel coronavirus pandemic this year.

Real gross domestic product shrank for the second consecutive quarter from January to March.

The group, chaired by Rissho University professor Hiroshi Yoshikawa, will date the peak by examining economic data, including on production and private consumption.

Share it

Exclusive: Beyond the Covid-19 world's coverage