A sudden contraction of the Japanese economy under the pressure of inflation and the risks of recession

The Japanese economy contracted unexpectedly for the first time in a year in the third quarter, leading to greater uncertainty on the economic outlook as household and business consumption weighed on the risks of a global recession, a weak yen and higher import costs.

The third largest economy in the world has faced difficulties despite the recent lifting of anti-Covid-19 restrictions.

Global inflation overheating, massive interest rate hikes in all over the world and war in Ukraine add to the pressure.

Official data showed that gross domestic product fell 1.2% year-on-year in the July-September period, compared to the estimate media of economists of a growth of 1.1% and a revised increase of 4.6% in the second quarter.

This means a quarterly decline of 0.3%, against growth expectations of 0.3%.

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