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Q4 corp capital expenditure up 7.7% yr/yr, rising 0.5%
qtr/qtr
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MOF capex data used to calculate revised GDP in Q4
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Little change seen in Q4 revised GDP - analyst
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Sales grow 6.1% yr/yr, profits fall 2.8%, first drop in 8
qtrs
(Adds analyst quote, detail)
By Tetsushi Kajimoto
TOKYO, March 2 (Reuters) - Japanese companies raised
spending on plant and equipment for a seventh straight quarter
through to the end of 2022, data released on Thursday showed,
offering relief to policymakers counting on a private demand-led
recovery from COVID.
Ministry of Finance (MOF) data showed Japanese firms raised
capital expenditure in October-December by 7.7% from the same
period a year earlier, slowing from a 9.8% gain in the third
quarter of 2022.
A boost to output capacity drove the higher capex
requirements as manufacturers such as chemicals and metal
products, as well as service-sector firms, prepared for an
uptick in demand.
The data is used to calculate revised gross domestic product
(GDP) figures due on March 9. Preliminary estimates showed
Japan's economy rebounded an annualised 0.6% in the fourth
quarter.
The weaker-than-expected GDP growth was caused by a decline
in capital spending, raising some doubt about whether the
world's No. 3 economy can achieve growth through private-sector
investment and wage hikes which would in turn boost consumption.
Quarter-on-quarter, seasonally-adjusted capital expenditure
rose 0.5%, the data showed.
"The capex data suggested there will be little change in
revised GDP data. The economy was stalling as global cyclical
demand went down," said Yoshimasa Maruyama, chief economist at
SMBC Nikko Securities. "Capital spending may hold firm but lack
strength until later in the coming fiscal year."
Corporate recurring profits fell 2.8% in the final quarter,
down for the first time in eight quarters, to reach 22.3768
trillion yen, but the earnings were still the second largest on
record for the fourth quarter.
Large profit declines at manufacturers such as chemicals and
petroleum/coal industries due to spikes in raw material prices
overwhelmed post-COVID gains at service-sector firms such as
transportation.
All firms' sales rose 6.1% in October-December from a year earlier, up for seven straight quarters, it showed. (Reporting by Tetsushi Kajimoto; Editing by Sam Holmes & Shri Navaratnam)
