The debt crisis that most Eurozone countries are suffering from has far reaching and global impact. One of the many countries who are suffering in response is that of Japan. Economic growth for the Japanese economy is slowing substantially – from 1% in the first quarter down to only 0.3% in the second quarter. This is even worse than expected and actually is down even more if you compare with the same period from last year.
There seems to be a concensus that Japan has worse to come with many expecting close to zero growth in the next quarter. Japan has always relied heavily on it’s exports and recently the value of the Yen has been high compared to other global currencies. This of course makes the countries exports more expensive and this combined with decreasing demand in the Eurozone and the US have impacted hard.
This would normally be offset by stronger domestic consumption but even this is proviing difficult with the rather pessimistic outlook even affecting internal demand. It was hoped that the extensive investment in repairing infrastructure dammaged by the earthquakes and Tsunamis would have more economic benefits. However this has turned out to be minimal and any positive boosts were likely to fade in the coming months.
For Japanese news and information – direct from Japan – try this.
The tools left to the Government are limited to promote growth – like most countries the interest rates are very low only 0.1% currently. If you want to see more details of the Japanese and other economic summaries from most countries then check out the online media in Australia which is an important trading partner. You may need to invest in an proxy to make you look like an Aussie if you live somewhere else (like this – http://www.theninjaproxy.org/tv/finding-an-australian-proxy/ )but there’s lots of information on the big media sites like ABC.