Bill Hagerty, who is the former U.S. ambassador to Japan and a candidate for the Senate in Tennessee, (R), says China must be held accountable for costing thousands of lives and destroying the economy.
Japan was hit in the second quarter by its largest economic contract on record, as the coronavirus pandemic disrupted consumption and exports, keeping policymakers under pressure for bold action to prevent a deeper recession.
The third straight quarter of declines reduced real gross domestic product (GDP) levels to low levels for decades, erasing the benefits of Prime Minister Shinzo Abe’s stimulus policy “Abenomics” launched in late 2012.
While the economy is recovering from the doldrums after lockdowns were lifted in late May, many analysts expect every rebound in the current quarter to be modest, as a renewed rise in infections retains consumers’ stock strings.
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A woman wearing a face mask walks through an electronic action board of a security company in Tokyo on August 3, 2020. Shares ahead in Asia on Tuesday, August 11, expanding into another rally that the S&P 500 took within striking distance of her all the time h
“The large decline can be explained by the decline in consumption and exports,” said Takeshi Minami, chief economist at Norinchukin Research Institute.
“I expect growth to be positive in the July-September quarter. But worldwide, handball is sluggish everywhere except for China. ”
The world’s third-largest economy shrank 27.8 percent year-on-year in April-June, marking government data on Monday, marking the largest decline since similar data were available in 1980 and slightly larger than a median market forecast for a 27.2 percent drop.
While the contraction was smaller than a decline of 32.9 percent in the United States, it was much larger than a fall of 17.8 percent that Japan suffered in the first quarter of 2009, when the collapse of Lehman Brothers shook global financial markets.
Japan’s real GDP growth shrank to 485 trillion yen, the lowest since April-June 2011, when Japan was still suffering from two decades of deflation and economic stagnation.
(Click here for an interactive chart of real and nominal GDP since 2011)
For a picture of Japan’s economy posted a record decline in the second quarter: click here
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The main culprit behind the stupid reading was private consumption, which plummeted a record 8.2 percent as measures to reduce pollution to prevent the spread of the virus that consumers keep at home.
External demand – as exports minus imports – hit a record 3.0 percentage point of GDP, as overseas shipments fell 18.5 percent, with car exports particularly hard.
Falling global sales outlets have hurt motorists such as Mazda Motor Corp (7261.T) and Nissan Motor Co. (7201.T), among Japan’s biggest drivers of the economy, and their parts suppliers.
Capital expenditures fell 1.5 percent in the second quarter, less than a median market forecast for a 4.2 percent decline, as solid software investment made up for weak spending in other sectors.
Economy Minister Yasutoshi Nishimura acknowledged that GDP readings were “quite heavy”, but pointed to some bright spots such as a recent pickup in consumption.
“We hope to do our utmost to push Japan’s economy, which was likely to crash in April and May, back to a recovery path driven by domestic demand,” he told a news conference.
Japan has deployed massive fiscal and monetary stimulus to escalate the blow of the pandemic, which hit an economy already suffering from last year’s increase in sales taxes and the US-China trade war.
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While the economy has reopened after the government lifted state of emergency measures at the end of May, a resurgence in infections wants the prospects for business and household spending.
