Equity market updates for 15 Feb, 2016

Economy of Japan contracted an annualised 1.4 per-cent in the final quarter of previous year as consumer spending slumped, contributing to headaches for policymakers already wary of damage the financial market rout could inflict on breakable recovery. The data underscores the challenges premier Shinzo Abe faces in dragging the economy out of stagnation. The contraction in gross domestic product (GDP) was bigger than a median market forecast for a 1.2 per-cent decline and followed a revised 1.3 per-cent increase in the previous quarter, Cabinet Office data showed on today. It matched a fall marked in April-June previous year. Private consumption, which makes up 60 percent of GDP, fell 0.8 percent, more than a median market forecast for a 0.6 per-cent decline, a sign Abe's stimulus policies have so far failed to nudge households into boosting spending. In a glimmer of hope for policymakers, moreover, capital expenditure went high 1.4 per-cent, confounding market estimations for a 0.2 per-cent decrease. While local requirement shaved 0.5 percentage point off GDP growth, external requirement, or net exports, contributed 0.1 point due to a decline in the value of imports caused by falling oil prices.

 

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