Japan's economy grew faster than initially estimated in the first quarter as capital spending fell less than was first reported, but worries remain over slow consumer spending and weak exports.
"The upward revision is very slight, and when you exclude the impact of leap year growth is not that strong," said Shuji Tonouchi, senior fixed income strategist at Mitsubishi UFJ Morgan Stanley Securities.
"We expect growth to slow in the current quarter. The government should focus on steps to help low-income earners, but consumption may not rise much if consumer sentiment worsens."
Further gains in the yen could lower export profits and discourage companies from increasing investment and wages.