Japan's economy contracted 0.9 percent in the late summer,
according to government data released Monday, as officials and
economists here warned that the country appears headed toward a
recession.
At an annualized rate, Japan's gross domestic product
shrank 3.5 percent, a reversal following two quarters of growth. The
drop-off signals the major obstacles facing the world's third-
largest economy as it deals with weakened demand in Europe and a
simmering diplomatic spat with China, both of which have hurt
Japanese exports.
Japan's exports for the quarter - a period between
July and September - plummeted 5 percent, the steepest drop since
immediately after the March 2011 earthquake and tsunami. In part,
this may have been due to the anti-Japan demonstrations in China and
the subsequent boycott of Japanese goods, Barclays Economic Research
wrote in a note after the data were released.
Economists predict that Japan's economy will shrink again in the
next quarter, leading to a technical recession. If Japan goes into
recession, it would be its third since 2008, according to Bloomberg.
Judging from recent economic indicators, the possibility cannot be
ruled out that the Japanese economy is already in a recessionary
phase, Japan's economy minister, Seiji Maehara, told reporters.
