Japan’s gross domestic product (GDP) growth was revised sharply higher in the first quarter, data on Monday showed, adding to hopes that its economic recovery is gaining traction.
GDP rose an annualized 3.9 percent in the first quarter, higher than the preliminary reading of a 2.4 percent increase.
On a quarter-on-quarter basis, the economy grew 1 percent, higher than the initial reading of 0.6 percent.
Japanese stocks showed only a muted reaction, with the benchmarkNikkei 225 up 0.3 percent in early trade. The yen, meanwhile, slipped 0.1 percent against the dollar.
The data follows supportive comments over the weekend from government spokesman Yasuhisa Kawamura, who said the economy was “returning to a growth orbit” on the sidelines of the Group of Seven (G7) summit.
However, investors should contain their optimism as Monday’s data remains “rear-view mirror gazing,” warned Mizuho Bank in a note. Consumer confidence data and machinery orders due later this week will provide a more real-time feel of the economy, the bank said.
Other data on Monday showed April’s current account balance at 1.3 trillion yen ($10.55 billion), a tenth consecutive month of surplus but lower than a Reuters forecast for a 1.7 trillion yen surplus.
A weaker currency has been boosting income from overseas investment, with the yen touching a more than twelve-year low against the greenback last week.