The set of data tags along encouraging comments over the last weekend from government spokesman Yasuhisa Kawamura, who said the economy "returning to a growth orbit" on the sidelines of the Group of Seven (G7) summit. However, investors should contain their optimism as Monday's data remains "rear-view mirror gazing," warned Mizuho Bank in a note.



GDP Spiked: Japan's GDP growth was improved sharply higher in the Q1, affixing to optimism that its economic recovery is gaining traction. GDP rose an annualized 3.9% in the Q1, higher than the preliminary reading of a 2.4% increase.



The economy grew 1% on a QoQ basis which is higher than the initial reading of 0.6%. Japanese stocks also showed only a muted reaction, with the benchmark Nikkei 225 up 0.3% in early trade. The yen, meanwhile, slipped 0.1% against the dollar.



Steep Spike in Capex QoQ: Capital expenditure grew at 2.7% from previous -0.1% beats the streets expectation. Streets had forecasted this number to flash at 2% while actual numbers have been way beyond forecasts that surprised traders. Banks lending also increased to 3.4% from previous 2.4%.



Consumer confidence: The data on this sentiment and machinery orders due later this week will provide a more real-time feel of the economy. Other data today showed April's current account balance at 1326.4 bln yen (approx USD 10.55 billion), a tenth consecutive month of surplus but lower than a Reuters forecast for a 1.7 trillion yen surplus.



Currency updates: We believe Yen against dollar to show strength in recovery if it manages to close below 125.580 on closing basis while yen against Euro remain non-directional amid Greece turmoil lingering around the corner. We've also been observing the Japanese hedger's volumes of futures contracts are diminishing gradually this indirectly suggests the currency recovery in the near term is the pipeline.