Japan to Forecast FY 2019 Growth of around 1.3 Pct

Politics Economy

Tokyo, Dec. 15 (Jiji Press)--The Japanese government plans to set its economic growth forecast for fiscal 2019 at around 1.3 pct in price-adjusted real terms, it was learned Saturday.

Although the consumption tax increase from 8 pct to 10 pct in October 2019 is expected to dampen consumer spending, the government believes that measures to cushion the tax hike impact, including the distribution of shopping reward points and so-called premium shopping vouchers, will prop up the economy to some extent, informed sources said.

Therefore, the government plans to forecast real gross domestic product growth exceeding Japan's potential growth rate of around one pct, the sources said.

The government will formalize the growth outlook for the year from April at a cabinet meeting as early as Tuesday. The forecast will serve as the basis for the tax revenue estimate used in the compilation of the fiscal 2019 draft budget, which will be adopted probably on Friday.

The government's growth forecast is higher than projections by the Bank of Japan and private-sector think tanks, many of which are less than one pct.

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