Japan's GDP figures may prompt Shinzo Abe to call snap election
Unless GDP growth figures turn out to be better than expected, Prime Minister Shinzo Abe is expected to call a snap general election
A set of economic data due in Japan today looks likely to determine the fate of "Abenomics", with an anticipated poor showing from third-quarter gross domestic product figures expected to prompt a general election.
Unless the July to September figures show an unexpected rally, the data is likely to provide the catalyst for Prime Minister Shinzo Abe to rule out a promised consumption tax rise and seek a new popular mandate, two years ahead of schedule.
The tax rises are aimed at paying down Japan's enormous national debt, but they have put Abe in a tricky position as he tries to balance them with his pro-spending growth plan.
The market's median forecast is for a 2.47 per cent annualised growth rate, according to a survey of 40 economists by the Japan Centre for Economic Research.
That would sidestep a technical recession, after Japan's GDP shrank an annualised 7.1 per cent in the second quarter, but it pales next to the first three months of the year, when the economy grew 6 per cent.
Since his 2012 election, Abe's plan to conquer years of deflation had been bearing fruit. But those efforts stumbled as consumers closed their wallets - and nervous firms capped their own spending - after sales taxes rose to 8 per cent from 5 per cent on April 1.