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TOKYO (MNI) – Economists expect slower near-term growth in Japan
but still foresee above 2% GDP rise in fiscal 2012 while projecting only
a gradual recovery in consumer prices, the latest monthly survey by the
Japan Center for Economic Research released on Thursday showed.

The association polled 40 economists and research institutes from
May 25 to June 1 for its ESP Forecast Survey, and 40 answered on the
growth and inflation outlook and 38 on the BOJ’s monetary policy stance.

The previous survey was conducted from Apr. 26 to May 8.

In the near term, economists expect GDP for the April-June quarter
of 2012 to post an annualized gain of a real 1.89%, an downward revision
from their previous average forecast for a 2.19% rise.

Amid global economic and financial uncertainties, the average GDP
forecast for the July-September quarter was also revised down to +1.88%
from +2.20% in the previous survey.

But for fiscal 2012 ending March 31, 2013, economists on average
forecast GDP will grow 2.27%, revised up from +2.15% forecast in the
previous survey.

Economists on average project a 1.50% rise in GDP in fiscal 2013,
revised down slightly from +1.52% projected the previous month.

The survey showed that the average forecast for core CPI (excluding
perishables) in fiscal 2012 was for +0.11%, up from 0.09% in the
previous survey. It would be the first annual increase in four years
since +1.2% in fiscal 2008.

Economists on average expect consumer prices to show a 0.20% rise
in fiscal 2013, unchanged from the previous month.

The forecasts showed that consumer price rises for the next two
years will remain far below the Bank of Japan’s longer-term goal of
achieving 1% annual inflation.

The survey also showed that 29 economists predict further monetary
easing by the Bank of Japan in coming months, mostly in July, up sharply
from 23 last month.

Meanwhile, nine economists expect the BOJ to start unwinding its
monetary easing in about a year ahead, down from 15 in the previous
survey.

tokyo@marketnews.com
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