Tokyo, March 9 (Bloomberg) -- Japan's economy probably returned to growth in the fourthquarter, rounding off its best year in three. That may be a high point, amid signs growth willslow this year, economists said.
Gross domestic product probably grew 0.6 percent in the three months ended Dec. 31,seasonally adjusted, according to the median of 36 forecasts in a Bloomberg News survey.The economy shrank 0.6 percent in the third quarter, and just one economist surveyedsaid it contracted again last quarter.
The rebound may be short-lived as the main supports of growth -- business investment andindustrial production -- get dragged down by slower global growth. That might prompt thegovernment to spend more shoring up the economy, though policymakers' options areconstrained by Japan's record debt.
``We're at a crisis point in many different ways, with policy being the most visible one,''said Vincent Musumeci, an economist at ABN Amro Securities (Japan) Ltd.
The fourth-quarter GDP report will be released Monday at 8:50 a.m., Japan time. Theeconomy probably grew 1.7 percent last year, the fastest since 1997, the survey found.Growth is expected to slow to 0.7 percent this year.
Investors have signaled their concern that Japan's economy is on the verge of anotherrecession, and the government has run out of answers. The benchmark Nikkei 225 stockindex has tumbled 40 percent the past 11 months, reaching a 15-year low last week.
The yen is trading near a 20-month low, and 10-year bond yields are at their lowest inmore than two years. The Bank of Japan last month cut its key interest rate 10 basispoints to 0.15 percent, six months after raising it from near zero.
Business Investment
The main source of growth last quarter was business investment, economists said. Capitalspending, which makes up about 15 percent of the economy, rose 6 percent in the fourthquarter, according to the Bloomberg survey. Housing investment probably rose 2.6 percentand public consumption chipped in with a 0.4 percent increase.
Net exports -- exports minus imports -- are expected to have subtracted 0.3 percentagepoints from growth last quarter. Exports shrank 0.2 percent, while imports rose 3.2percent, according to economists' forecasts.
Japan's steelmakers are expected to cut production this year as sales to Asia slow.Nippon Steel Corp., the country's largest steelmaker, this week cut its full-year profitforecast 12 percent, while rival Kawasaki Steel Corp. cut its target for pretax profit fromoperations 13 percent and said it will post a net loss.
Overseas Impact
``There's an impact on our business from the slowdown of overseas economies,'' saidYukiko Nagai, a spokeswoman at Nippon Steel. ``Exports are being affected.''
Falling demand in Asia may cut Japanese steel production to 98 million metric tons thisyear, 8 percent below the three-year high of 106 million metric tons in 2000, the Japan Ironand Steel Federation said.
Exports, by volume, dropped for the first time in 20 months in January as shipments to allJapan's major trading partners --Asia, the U.S. and the European Union -- fell.
Overseas demand for cars, cameras and other Japanese-made goods helped fueleconomic growth last year, as manufacturers spent more on factories and equipment, andПодедржка экономике Японии довольно слабая, поскольку экономическийрост в США за 4 квартал составил минимальное значение за последние 5,5лет, экономикиЮжной Кореи и Гонконга также показали спад. Внутреннеепотребление, которое составляет около 60% ВВП вряд ли покроет разрыв,ожидается, что как раз оно упадет на 0,1%кв/кв. Розничные продажи вотделах супермаркетов за прошлый год снизились на 0,9%, гос инвестициитакже упали, за 4 квартал прогнозируется -0,3%. Общий прогноз роста на2000-2001 финансовый год +1,7%.