Japan Enters Fresh Recession

07 December 2001

Japan has fallen into its fourth recession in the last ten years.

Government figures show that in the three months to September the Japanese economy contracted 0.5% from the second quarter (2.2% year-on-year), following a 1.2% decline in Q2. Two consecutive quarters of contraction are the accepted definition of a recession.

As far as analysts are concerned, the outlook remains bleak for Japan, with Merrill Lynch predicting a further four quarters of contraction.

Despite a surprise 1.1% rise in Q3’s corporate capital investment, personal consumption shrank 1.7%. In addition, exports, previously an essential factor in tuning the economy around, are tumbling and corporate earnings are down due to falls in prices.

News source: Wall Street Journal