What's NewA slump in imports is no good news for Japan.

Cabinet Office estimated Japan to have grown by 0.5% in the January-March quarter. The surprising positive growth should provide no solace for Japan watchers though. The reason the economy "grew" was due to the severe contraction in imports, the severest shrinkage since the great recession in 2009. The weak imports may boost the growth on numbers, but the weak import should simply imply weak domestic demand. In any case, we think the growth estimate will be revised down when the Cabinet Office receive more data and publish its second preliminary GDP estimate on June 10. (May 20, 2019)

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