The Japanese government predicts the economy will expand by 3.5% in the coming year, almost double its original forecast of 1.8%.
Thanks to consumer demand and strong exports, economic recovery is expected to continue in what could be the fastest expansion in eight years.
Although the optimistic outlook represents a turnaround for Japan, the government's cabinet office expects growth to slow slightly to just over 2% in the fiscal year ending March 2006, due to reduced global growth.
The official estimates for both fiscal years concur with the views of private economists.
Data sourced from: The Wall Street Journal Online; additional content by WARC staff