Despite calls for further weakening in the Japanese currency vs. the dollar, economists say Japan’s overall fundamental outlook is improving.
“We are optimistic about Japan’s recovery, seeing a growth of at least trend in 2005 at 2.0%,” says Westpac’s Callow.
Job creation is expected to continue, with expectations for the overall unemployment rate to fall to 3.8 percent in 2006 from an expected 4.3 percent in 2005.
The September general election win by Prime Minister Junichiro Koizumi was seen as a bullish factor for the Japanese economy, as a major goal of Koizumi’s is privatization of the Japanese postal system (which also includes the nations largest bank), which is seen as constructive for longer-term growth there.
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