Partly due to the effects of the QQE, Japan’s economy has been growing above its potential growth rate led by domestic demand, with real GDP growth increasing year-on-year by 1.5 percent on average in 2013, and by 2.5 percent measured from fourth quarter to fourth quarter.
On the employment front, the unemployment rate has declined to 3.7 percent, which is close to the structural unemployment rate of around 3½ percent. As for the outlook, Japan’s economy is expected to continue on a moderate recovery with a virtuous cycle among production, income, and spending at work.