THE WisdomTree BLOG
Japan’s recent gross domestic product report was stronger than expected, up 2.1% quarter over quarter and annualized, against expectations for a small decline. Jesper Koll discusses the Japan equity investment implications amid the macroeconomic and political environments.
2019 is likely to be a good year for Japan. However, there are some outlier scenarios investors may worry about. Improbable as they may seem, any movement toward their far-out direction will force a true about-face in the current consensus. Jesper Koll outlines 10 potential surprises for Japan in 2019.
On Thursday, Japanese prime minister Shinzo Abe was re-elected as the ruling Liberal Democratic Party leader, winning by a very solid 70-30 margin against his one internal competitor. This bodes well for Japan’s economy in general, and Japanese risk assets in particular.
Japan’s GDP report was a nice, positive surprise. Real GDP accelerated 1.9% in the April–June quarter, which was about half a percent better than consensus expectations. This is right around Japan’s growth potential—fast enough for corporate profits to rise but not too fast to warrant changes in monetary policy.