Japan's recession worse than thought: official data

http://news.yahoo.com/s/afp/20081209/bs_afp/japaneconomygrowth_081209004130

Mon Dec 8, 7:41 pm ET

TOKYO (AFP) – Japan's economy shrank 0.5 percent in the third quarter of this year, sinking much deeper into recession than previously thought, official figures showed Tuesday.

Asia's largest economy contracted 1.8 percent on an annualised basis in the three months to September, when Japan entered its first recession in seven years with a second straight quarter of negative growth, the government said.

An initial estimate last month had shown the Japanese economy shrank 0.1 percent in the third quarter, and 0.4 percent on an annualised basis.


Weak business investment was the main culprit for the revision as companies slashed investment in new equipment and factories by 2.0 percent, compared with an initial estimate of 1.7 percent.

Japan's export-dependent economy was also hit by sluggish exports as the global financial crisis hit international trade.

The latest snapshot of the Japanese economy was even more gloomier than analyst forecasts for a contraction of about 0.2 percent quarter-on-quarter.

The government said the economy shrank a revised 1.0 percent in the second quarter, which was also slightly worse than previously thought.

Japan has relied on brisk exports of cars, electronics and other goods to drive its recovery from recession in the 1990s.

But it has seen exports weaken in recent months due to worsening demand in recession-hit overseas economies.


Copyright © 2008 Agence France Presse. All rights reserved. The information contained in the AFP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of Agence France Presse.


Copyright © 2008 Yahoo! Inc. All rights reserved.Questions or CommentsPrivacy PolicyTerms of ServiceCopyright/IP Policy