On an annualized quarter-on-quarter basis, the real GDP growth rate for the October-December quarter of 2016 registered 1.2 percent, representing an increase for four consecutive quarters. The rate continued to rise, due mainly to an increase in external demand, although domestic demand was somewhat sluggish. With regard to the outlook, Japan's economy is likely to turn to a moderate expansion.
The net spillover effects need to be estimated, and it cannot be taken for granted that the positive spillovers from the initiating country’s growth (say through greater trade) more than offset the adverse spillovers to other countries.