Japan will test a new method of calculating the government's initial estimate of GDP by collecting more data on capital expenditure from the private sector, Reuters reported March 6, citing the internal affairs ministry.
Japan's cabinet approved the plan March 6. The new method will be tested from fiscal 2019 and a final decision will be made by fiscal 2022, the report said.
Under the new method, the finance ministry will push forward the schedule of its quarterly survey on capital expenditure. The Cabinet Office will use part of the survey results to calculate the capital expenditure component of preliminary GDP.
Big swings in capital expenditure in the past have led to huge differences between preliminary and revised GDP data, prompting economists to question the accuracy of the GDP data, Reuters said.
Japan's economy grew 0.5% on an annualized basis in the fourth quarter of 2017, its eighth straight quarter of expansion and the longest period of continuous growth since the 1980s. But constant revisions to past data mean this surge of growth was not always clearly reflected in the data, the report said.
