Japan Q4 GDP expands annualised 0.6 vs f39;cast 2.0
Drop in capex, inventory behind weakerthanexpected rebound
Data underscore view Japan making delayed recovery from pandemic
Outlook on growth, wages key to how soon BOJ exits easy policy

TOKYO, Feb 14 Reuters Japan39;s economy averted recession but rebounded much less than expected in the fourth quarter as business investment slumped, a sign of the challenge the central bank faces in phasing out its massive stimulus programme.

While private consumption is holding up against headwinds from rising living costs, uncertainties over the global economic outlook will weigh on Japan39;s delayed recovery from the scars of the COVID19 pandemic, analysts say.

The world39;s thirdlargest economy expanded an annualised 0.6 in the final quarter of last year after slumping a revised 1.0 in JulySeptember, government data showed on Tuesday.

The increase in gross domestic product GDP was much smaller than a median market forecast for a 2.0 rise, due to a downswing in capital expenditure and inventory.

From a negative growth in JulySeptember, the rebound isn39;t very impressive, said Toru Suehiro, chief economist at Daiwa Securities.

We can expect consumption to pick up as service spending stabilises. But it39;s difficult to project a strong recovery partly due to pressure from rising inflation, he said.

BOJ POLICY CHALLENGE

The weak data highlights the delicate task at hand for Kazuo Ueda, the government39;s nominee to become…