Published: December 8, 2023 9:05 pm
Author: RT
The world’s fourth-largest economy saw a sharp contraction in the third quarter
The Japanese economy contracted by almost 3% in the third quarter of 2023, suffering its first decline in a year as inflation weighed on household consumption and corporate investment slowed, revised data showed on Friday.
GDP in the world’s fourth-largest economy shrank by an annualized 2.9% between July and September, worse than a previously estimated 2.1% contraction and market forecasts for a 2% decline, according to data from the Cabinet Office.
“Weakness in personal consumption is likely to continue for the foreseeable future, as real disposable income is likely to extend its decline, which is seen as a factor in sluggish consumption,” said Kota Suzuki, an economist at Daiwa Securities.
Private consumption, which makes up more than half of the economy, dropped 0.2% in the third quarter, versus the initial estimate of flat performance. Prolonged inflation discouraged shoppers and was cited as leading to the downward revision.
READ MORE: Majority in EU expect living standards to fall in 2024 – poll
Inflation-adjusted real wages fell 2.3% year-on-year in October, marking the 19th consecutive month of decline, separate data revealed.
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