The Japanese economy stepped up a gear with 5.5% annualized growth in the fourth quarter of 2005 as rising consumer spending helped keep the recovery firmly on track, the government said Feb. 17. Japan's economy grew five times faster than the U.S. which saw annualized growth of 1.1% in the same period.
It was the fourth straight positive quarter and reinforced hopes that the world's second-largest economy is finally on a sustainable recovery path after a slump stretching back over a decade.
Quarter-on-quarter, Japan's gross domestic product (GDP) grew 1.4%, beating market expectations for 1.2% and significantly stronger than the 0.3% pace seen in the third quarter of 2005.
For 2005, the Japanese economy grew 2.8%, expanding for a sixth straight year, the Cabinet Office said.
For the three months to December, domestic demand grew 0.8% quarter-on-quarter, up sharply from the moderate 0.3% pace seen in the previous quarter. Private demand showed robust 1.1% growth from the September quarter, when it grew 0.3%. Private consumption, which accounts for some 55% of the Japanese economy, expanded 0.8%, up from the 0.4% growth registered in the three months to September.
Corporate investment spending grew 1.7% in the three months, compared with 1.8% growth in the September quarter.
Copyright Agence France-Presse, 2006