Japan's economy contracted in Q3 on covid disruptions in a sign that it will be long struggle to ever raise interest rates.
- GDP annualized -3.6% vs -3.1% expected (first estimate was -3.0%)
- Private consumption -1.3% vs -1.1% prelim
- External demand 0.0% vs +0.1% prelim
- Inflation deflator vs -1.1% prelim
- Capex -2.3% vs -3.9% expected
This isn't a great slate of data but at least there were some better capex numbers. Indications are that private consumption rebounded in October/November but omicron will add a fresh reason to stay home.
Nikkei futures are up 1.0% today and the reaction in the yen to this data was minimal.
