Economy bigger than thought and poised to rebound

Rebased national accounts data released this week show that Japan’s nominal GDP is around 5% higher than previously estimated, which in turn implies that the ratio of public debt to GDP is lower. This is another reason not to worry unduly about fiscal risks in Japan, despite Prime Minister Takaichi's embrace of looser fiscal policy. Meanwhile, there are growing signs that the real economy is rebounding strongly from its Q3 slump: the Bank of Japan will be reassured as it meets next week.