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Growth likely to fall as energy costs, weakening U.S. market hobble consumer spending The Cabinet Office on Tuesday lowered its forecast for real economic growth in fiscal 2008 from 2.0 percent to 1.3 percent, citing surging energy costs and weakening growth in the United States that has hurt corporate earnings and consumer spending here. The revised forecast follows a similar change by the Bank of Japan, which cut its fiscal 2008 forecast from 1.5 percent to 1.2 percent last week. The Cabinet Office's downgrade was presented to the Council on Economic and Fiscal Policy. The government will use the estimate as its basis for setting the guidelines for the fiscal 2009 budget. Slower growth will make it harder for debt-ridden Japan to rebuild its public finances because it is also likely to mean lower tax revenues. The Cabinet... [read full story]
