Japan Posts 6.5 Percent Increase in Corporate Spending

(MENAFN) Japanese firms boosted capital investment in the October–December quarter, recording a 6.5 percent increase from a year earlier, government data confirmed Tuesday. The rise marked the fourth consecutive quarter of growth.

The Ministry of Finance reported that nonfinancial companies invested 15.39 trillion yen (around 97.9 billion U.S. dollars) during the period. Much of the momentum came from the information and communications sector, where demand for new data centers has been driving expansion.

Corporate earnings also strengthened. Pretax profits advanced 4.7 percent to 30.03 trillion yen, extending gains for a fifth straight quarter. Sales edged higher by 0.7 percent to 400.65 trillion yen, continuing an unbroken run of increases that now spans 19 quarters.

These figures will be incorporated into revisions of Japan’s gross domestic product for the fourth quarter. Preliminary GDP data showed the economy grew at an annualized real 0.2 percent, its first expansion in two quarters.

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