Gross domestic product (GDP) expanded 0.2% in the October-December period and 1% annually, the Cabinet Office said in a preliminary estimate on Monday. That follows a 0.3% expansion in the third quarter that disappointed preliminary estimates that showed stronger growth.
Economists in a median estimate forecast GDP to expand 0.3% on the quarter and 1.1% annually.
With the gain, the Japanese economy has now expanded for four consecutive quarters, although the rate of growth has steadily declined over that period. Recent data on manufacturing and employment suggest the economy is gradually improving, although uncertainty about global trade relations could create fresh headaches for policymakers.
Analysts have noted the potential for a major rift in trade relations between the United States and Japan following the election of Donald Trump. After inauguration, Trump immediately withdrew the United States from the Trans-Pacific Partnership (TPP), a deal that Prime Minister Shinzo Abe strongly supported. With the death of TPP – a deal that was widely regarded as one of the most ambitious of all time – Japan must now look for new avenues for strengthening the globalization narrative.