Japan’s economy shrank sharply during the third quarter as global supply chain disruptions and a resurgence in Covid-19 cases damped spending by both consumers and businesses.
The bigger-than-expected contraction was released as Fumio Kishida, the newly appointed prime minister, prepared to unveil a big stimulus package of cash handouts and subsidies for struggling households and small businesses to reboot Asia’s largest advanced economy.
The Japanese economy shrank at an annualised rate of 3 per cent in the July to September quarter, worse than analysts’ expectations of a 0.8 per cent contraction. On a quarter-on-quarter basis, gross domestic product fell 0.8 per cent after a rebound of 0.4 per cent in the April to July period, according to government data released on Monday.