Japan's Demand Shortfall Shrinks to 34 T. Yen in July-Sept.

Economy

Tokyo, Nov. 27 (Jiji Press)--Japan's demand shortfall, or excess supply over demand, in July-September shrank to an estimated 34 trillion yen on an annualized basis, the Cabinet Office said Friday.

The figure narrowed from the previous quarter's estimate of an annualized shortfall at about 57 trillion yen, which was the worst since the Cabinet Office started calculating such estimates in 1980.

The output gap, a measure of the supply-demand balance in the economy, stood at minus 6.2 pct in July-September, the second quarter of fiscal 2020. The gap is still big, although it shrank from minus 10.5 pct in April-June.

Some members of the ruling Liberal Democratic Party are demanding the government set aside around 20 trillion yen under its third supplementary budget for fiscal 2020 to fill a demand shortfall brought on by the coronavirus crisis.

"I have a strong sense of crisis," economic and fiscal policy minister Yasutoshi Nishimura told a press conference on Friday. "Under our strong commitment not to get the country back to deflation, we want to work out an extra budget that would allow the economy to return to a growth path led by private demand."

[Copyright The Jiji Press, Ltd.]

Jiji Press