The Japanese economy is still recovering and SEB’s economists remain relatively optimistic on the near-term growth prospects, helped by further reconstruction work.
Still, yen appreciation is hurting the export sector and consequently the economists have sliced a few tenths off of the 2012 GDP forecast. Real GDP will grow 1.7 per cent and 1.2 per cent in 2012 and 2013, respectively according to an updated forecast.
The unemployment rate has drifted higher again, but according to SEB’s forecast it will hold steady at its current level in 2012-13. Core inflation is below zero again in year-over-year terms and will probably not move back into positive territory until this summer.