Japan downgrades growth assessment
TOKYO – JAPAN’S government yesterday downgraded its assessment of Asia’s largest economy for the first time in 15 months, saying the recovery was losing steam due to slowing United States growth.
A monthly report from the Cabinet Office acknowledged that exports and industrial output are cooling, while consumer spending is sluggish.
‘The economy is recovering at a moderate pace,’ the report said, tweaking its previous assessment that the economy ‘is recovering, while some weaknesses are seen’. The government said the move marked the first downgrade since November 2006.
The report cited downside risks to the Japanese economy resulting from slowing US economic growth, financial market volatility and higher oil prices.
The government also downgraded its assessment of exports for the first time in 17 months, saying they were ‘increasing moderately’.
‘Exports to Asia continue to be solid, while shipments to the US are declining and those to the European Union are turning almost flat as its economic recovery is moderating,’ a Cabinet Office official said.
The report lowered its assessment of industrial production for the first time in eight months, saying it was ‘growing at a slower pace’.
Source: AGENCE FRANCE-PRESSE (The Straits Times 23 Feb 08)