Japan’s economy has fallen back into recession for the fourth time in five years after third quarter GDP contracted 0.8 per cent, according to initial estimates.
A 1.3 per cent drop in business spending drove the worse than expected fall, which followed on from a revised second quarter contraction of 0.7 per cent.
Economists had expected just a 0.2 per cent drop for the third quarter, but the business spending figures were significantly worse than forecast.
Private consumption, however, rose by 2.1 per cent following a 2.3 per cent fall in the second quarter.
But the data will put more pressure on the Bank of Japan to add to its quantitative easing programme, weeks after the central bank declined to expand its package of stimulus measures at its October meeting.
Prime minister Shinzo Abe, in an attempt to keep his ‘Abenomics’ programme of reforms on track, announced plans in September to boost nominal GDP - growth figures unadjusted by inflation - by 3 per cent per year until 2020.
Nominal GDP growth for the third quarter, however, stood at just 0.1 per cent, the latest figures show.
