Gross domestic product rose at an annual 4.6 percent pace in the three months ended Dec. 31, the Cabinet Office said in Tokyo today, more than the 3.5 percent median estimate of economists surveyed. The GDP deflator, the broadest measure of prices in the economy, fell a record 3 percent.
Exports led the expansion, aided by a global recovery that prompted manufacturers from Panasonic Corp. to Nissan Motor Co. to raise their profit forecasts this month. An increase in consumer spending may not last as government stimulus measures fade and households expect prices to keep falling along with their wages, said economist Hiroshi Miyazaki.
The world’s second-largest economy expanded 1.1 percent from the previous quarter, today’s report showed.
Third-quarter GDP was revised to zero from an annualized 1.3 percent growth, reflecting a change in how the Cabinet Office calculates exports and imports on a seasonally adjusted basis to account for the global trade collapse in 2008.
Overseas shipments increased 5 percent from the previous three months, the report said. Net exports, or shipments minus imports, added 0.5 percentage point to growth.
The GDP deflator’s year-on-year decline was the biggest since records began in 1955. Without adjusting for price changes, Japan grew an annualized 0.9 percent from the previous quarter.
The Bank of Japan, amid pressure from politicians, stepped up its fight against deflation in December, saying it does not tolerate” price declines.
Spending by consumers, which accounts for more than half of the economy, rose 0.7 percent in the fourth quarter, today’s report showed. Business investment climbed 1 percent, the first positive reading in seven quarters.