Japan grew by 3% in the fourth quarter of 2020 over the previous three-month period. Real gross domestic product in the final quarter of the year totaled ¥542.7 trillion, just 1% lower than the ¥548.8 trillion recorded in the final quarter of 2019 on a seasonally adjusted basis. The Nikkei 225 breached the 30,000-point mark for the first time since 1990 on Monday as it rose 1.2% on the upbeat economic data, while the benchmark Topix index edged up 0.7%. The strong rise in GDP in the fourth quarter left output just 0.5% below pre-virus levels.
Japan’s economic outlook depends on those of its major trading partners, especially the US and China, and whether a decline in government approval ratings increases pressure for populist fiscal measures. Economic data offers some hope in a grim week as an earthquake struck near Fukushima – where a devastating temblor and tsunami occurred a decade ago – and the delayed Tokyo Olympics were plunged into fresh chaos by the resignation of the head of the organizing committee. One bright spot was the announcement that Japan would start inoculations against Covid-19 on Wednesday after finally approving the Pfizer vaccine. Medical personnel will receive the first jabs, followed by the elderly. Local governments will send out vouchers to each age group as they become eligible, and then they will make their own appointments with clinics assigned the vaccine. Japan’s vaccination campaign is about two months behind other countries because of the time needed to complete local clinical studies, which check that vaccines produce a similar level of antibodies when used in Japan. AstraZeneca expects to complete its filing with the Japanese regulators by mid-March, but Moderna only began its local study recently, and it will be several months before it can file for approval.