Japan’s economy contracts 0.8% in the third quarter

The Japanese economy contracted 0.8% in the third quarter of the year, more than market expectations, due to a Covid-19 outbreak that slowed down domestic demand, according to preliminary data released Monday by the government.

The contraction exceeded the forecast for a 0.2% drop, and reflected the sharp decline in consumption during a state of emergency imposed during the summer by a wave of Covid-19 infections.

The decline in Japan’s Gross Domestic Product (GDP) in the period from July to September is also explained by a decline in non-residential investments by private companies, according to official data.

Japanese industry suffered during the period from global shortages of semiconductors and other components, which drove the country’s exports down 2.1%, the first drop in more than a year.

The new Japanese Prime Minister, Fumio Kishida, has said that economic recovery is one of his priorities.



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