Japan : Staff Report for the 2005 Article IV Consultation

This 2005 Article IV Consultation highlights that the GDP growth in Japan slowed unexpectedly in the second quarter of 2004, after several quarters of above-trend growth. For the full year, GDP rose by 2.6 percent, well below expectations. A significant part of the shortfall reflected a shift to a chain-weighted methodology-growth on the old methodology was 3.6 percent. Pressure on labor markets from job shedding is slowly abating. Progress in corporate restructuring continues. Cash flow and profits remain buoyant; bankruptcies have fallen to a 10-year low and leverage continues to decline.