26 January 2001, 17:55  Japan's Aso says Oct-Dec GDP possible to rise on quarter

--Japan's Aso says CPI drop is not a "good fall"
--Japan's Aso sees soft landing for US econ as highly possible
--Japan's Aso doesn't want BOJ to ease monetary policy
By Reiko Mizutome, BridgeNews
Tokyo--Jan. 26--Japan's real gross domestic product (GDP) in October-December may show a rise from July-September, because data suggested that personal consumption rose that quarter, Taro Aso, Minister of State for Economic and Fiscal Policy, said Friday. Aso added that he does not view consumer price falls as a beneficial result of production technique improvements.
* * * The Ministry of Economy, Trade and Industry (METI) released earlier Friday that commercial sales--retail sales and wholesale sales combined--for October-December rose for rose adjusted 1.8% on quarter, after showing a 1.4% drop in July-September. This data indicated that personal consumption, the largest component of GDP, may rise on quarter in October-December.
Asked about whether October-December GDP will show a growth on quarter, Aso said that, "looking at the (commercial sales) data, it is likely that (real GDP for October-December will grow on quarter.)"
Real GDP for October-December is expected to be released in early March by the Cabinet Office. Preliminary real GDP for July-September showed a rise of 0.2%, or annualized 1.0%, on quarter.
Regarding recent falls in consumer prices, Aso said that, "(I realize that) Japan is the only major country which has faced falls in prices," adding that, "it is unlikely that only Japan has enjoyed improvements in production techniques." His comment indicated falls in consumer prices in Japan are not considered a "good fall"--caused by improvement of production techniques.
The Ministry of Public Management, Home Affairs, Posts and Telecommunications announced earlier Friday that the consumer price index (CPI) for the Tokyo metropolitan area in January was down 0.4% from a year earlier, and the nationwide CPI in December was down 0.2% on year.
Aso said in an interview Wednesday that, "a deflationary spiral could occur."
However, Aso said he does not want the Bank of Japan to ease monetary policy now.
As for the U.S. economy, Aso said he sees that soft-landing of the U.S. economy is highly possible because Federal Reserve Chairman AlanGreenspan endorsed tax cuts to support the economy. End
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