Japanese GDP Surpasses Expectations

Gross Domestic Product figures surprised to the upside, printing at 3.3% in the year to the first quarter versus expectations of 2.5%. Strong export demand from emerging economies helped to keep Japanese economic growth afloat all the while US demand waned. Japan is reliant on foreign demand to keep the economy afloat as falling wages and rising commodity prices have cut disposable income to make the already thrift-minded Japanese consumers even less likely to spend. March Trade Balance figures saw a sharp decline in exports, suggesting most of the positive gains seen in this release come from January and February. That data saw shipments to China slowing. Exports to Europe are likely to slow in the coming months as well - contagion from the US crisis has weighted substantially on recent European data. While today's result is certainly a positive one, it may prove difficult for good news to persist.

DailyFX

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