Japan has sidestepped a recession, preliminary data showed Wednesday, but a weak first-quarter growth reading underscored how Tokyo's efforts to kickstart the world's number three economy are not gaining traction.
The country's gross domestic product expanded by 0.4% between January and March -- or 1.7% at an annualised rate -- after a contraction in the last three months of 2015.
A rebound in consumer spending helped drive the slightly better-than-expected figures, but they will do little to buoy hopes for Prime Minister Shinzo Abe's faltering growth blitz.
The premier's bid to revive Japan's once-soaring economy, dubbed Abenomics, was shaken by a bloodbath on equity markets at the start of the year and a resurgent yen which has taken a bite out of Japan Inc's profits.
The latest underwhelming GDP data will 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.
"But even if the government delays the tax hike, it still needs to set a course for getting public finances on a sound footing, which is not an easy job," said Yoko Takeda, chief economist at Mitsubishi Research Institute.
"The economy is in a tough situation with the strong yen hurting corporate earnings, stalled wage hikes and a lack of confidence among consumers. There are going to be some tough times ahead."
Wednesday's figures came days before Japan hosts a meeting of the Group of Seven finance chiefs and a summit of their leaders next week.
The finance group -- including US Treasury Secretary Jack Lew and European Central Bank President Mario Draghi -- converge at a hot spring town north of Tokyo where two days of meetings kick off on Friday.
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The country's gross domestic product expanded by 0.4% between January and March -- or 1.7% at an annualised rate -- after a contraction in the last three months of 2015.
A rebound in consumer spending helped drive the slightly better-than-expected figures, but they will do little to buoy hopes for Prime Minister Shinzo Abe's faltering growth blitz.
The premier's bid to revive Japan's once-soaring economy, dubbed Abenomics, was shaken by a bloodbath on equity markets at the start of the year and a resurgent yen which has taken a bite out of Japan Inc's profits.
The latest underwhelming GDP data will 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.
"But even if the government delays the tax hike, it still needs to set a course for getting public finances on a sound footing, which is not an easy job," said Yoko Takeda, chief economist at Mitsubishi Research Institute.
"The economy is in a tough situation with the strong yen hurting corporate earnings, stalled wage hikes and a lack of confidence among consumers. There are going to be some tough times ahead."
Wednesday's figures came days before Japan hosts a meeting of the Group of Seven finance chiefs and a summit of their leaders next week.
The finance group -- including US Treasury Secretary Jack Lew and European Central Bank President Mario Draghi -- converge at a hot spring town north of Tokyo where two days of meetings kick off on Friday.
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