🇯🇵Cable FX Macro Weekly Note: Japan Q3 GDP

**As seen in Risk In The Week report 11/11/2022, subscribe at cablefxm.co.uk/reports

The Japanese economy expanded by 3.5% over the second quarter, this was higher than the consensus estimate of an annualized 2.9%. The quarterly figure showed output rising by 0.9%, above the expected 0.7%. The economic strength was mostly supported by domestic and private demand, the former contributed to 1.8% of the output, higher than the prior 1.4%. Public investment contributed to 0.1% of the print, however, this was a rebound from the prior -2.1% and a series of negative quarters. Net exports dragged the headline by -1.1% as both exports and imports decelerated on the quarter, the former increased by 6.8% Q/q and the latter came in at 11.1%. The desk at MUFG see growth slowing down from Q2, they expect personal consumption and capex to remain solid, but say that contribution from external demand probably turned negative due to stepped-up imports. Analysts at Wells Fargo say that the sharp drop in economic output will reflect an easing in consumer spending, which will offset the rises in investment spending. They note that the government is looking to deploy further fiscal stimulus given the rise in living costs, while the BoJ is reluctant to shift its monetary policy stance, this is likely to support growth over the next quarters.