Tokyo, November 25
Japan’s government signalled concern about financial markets as Donald Trump’s election to U.S. President and Britain’s negotiations to exit the European Union could cause uncertainty.
The government stuck to its overall assessment in its monthly economic report for November, issued on Friday, which described the economy as being in moderate recovery while still showing weakness.
“The economy is on a moderate recovery, while weakness is seen recently,” the Cabinet Office said in the report, using the same description that it has since March.
The report mentioned uncertainty in the global economy, which is a reference to doubts about U.S. economic policy and Britain’s so-called “Brexit” from the EU, a Cabinet Office official told reporters. The Cabinet Office, which coordinates government economic policy, delayed the release of the report from last week because Prime Minister Shinzo Abe flew to New York for a hastily arranged meeting with U.S. President-elect Trump. Since then, Trump has declared he will withdraw from the Trans-Pacific Partnership after taking office in January, which is a blow to Japan because Abe was counting on the free trade agreement to drive structural reforms, some economists say.
Japan’s export-driven economy could also suffer if Trump adopts protectionist policies that would potentially curb global trade.
The Cabinet Office said exports are flat, unchanged from last month’s assessment.
Consumer spending is holding steady, while industrial output is showing signs of picking up, the report for November said. Both assessments were unchanged from last month.
Japan’s economy expanded for a third straight quarter in July-September as exports recovered, but domestic activity remained weak. Other data has shown consistent declines in consumer prices, another warning sign that domestic demand lacks momentum.
Tokyo, November 25