Japan’s economy grew an annualized 1.4% in the April-June period, the Cabinet Office reported Monday, with the result marking a sharp cooling from the upwardly revised 5.5% advance in the previous quarter
The result compared with expectations for 2.7% gross domestic product growth, according to a Dow Jones Newswires survey, as a strong Japanese yen hurt the country’s trade account, a centerpiece of the economy
Quarter-on-quarter, the economy grew 0.3%, slowing from 1.3% the previous quarter and missing a 0.7% forecast. The annualized gain for January-March was marked upward to 5.5% from 4.7% previously
While Japan managed to post a surprise trade surplus in June, the swing came as both exports and imports fell from a year earlier, with shipments to Europe plunging more than 25%
As Europe’s debt crisis grinds on, FactSet data show the euro has consistently traded below the ¥100 level since mid-July, weighing on trade with the euro zone
And while the U.S. dollar has risen above its late-2011 lows against the Japanese currency, it is still weak by historical standards
Private consumption has helped cushion some of this foreign-exchange impact, and was a factor in the strong growth in the first quarter of the year
However, the currency headwinds have hit results at many Japanese blue chips, with Sony Corp. Sharp Corp. and other powerhouses now trading at or near multi-decade lows
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