TOKYO, Japan (AFP) Wednesday 5/18/2016 — Japan sidestepped a feared recession in the first quarter, preliminary data showed Wednesday, but the weak growth reading underscored how Tokyo’s efforts to cement a firm recovery in the world’s number three economy have failed to gain traction.
Gross domestic product expanded by 0.4 percent between January and March — or a 1.7 percent annualised rate — after a contraction in the last three months of 2015.
But the slightly better-than-expected figures will do little to buoy hopes for Prime Minister Shinzo Abe’s faltering growth blitz, dubbed Abenomics.
The underwhelming data also throw a renewed focus on plans to raise Japan’s consumption tax again.
Local media have suggested Abe will delay hiking the levy over concerns it could damage the already fragile economy.
A tax rise in 2014 — seen as key to helping pay down Japan’s enormous national debt — was blamed for ushering in a brief recession.
Tokyo stocks rise
Meanwhile, Tokyo stocks opened higher Wednesday with the economy’s slight expansion.
The benchmark Nikkei 225 index at the Tokyo Stock Exchange rose 0.15 percent, or 24.92 points, to 16,677.72 after the opening bell, while the broader Topix index of all first-section shares was up 0.22 percent, or 2.89 points, at 1,338.74.