12/07 01:20
Japan Back in Recession as 3rd-Qtr GDP Contracts 0.5% (Update6)
By Ann Saphir, with reporting by Yoshiko Matsushita, Mayumi Otsuma, Keiko Kambara, Tatsuo Ito
quote.bloomberg.com
Tokyo, Dec. 7 (Bloomberg) -- Japan slid back into recession for the third time in a decade as record unemployment damped consumer spending and a global slowdown sapped exports. Government officials said the second-biggest economy will probably also shrink next year.
Gross domestic product shrank 0.5 percent in the third quarter, the government said, led by a 1.7 percent drop in consumer spending. While that was in line with expectations, the second-quarter decline was revised to 1.2 percent from an initial 0.7 percent contraction.
Consumers have responded to a series of corporate failures and staff cuts at Japan's leading companies by reining in spending. Aoki Corp., a contractor with 7,277 staff, filed for bankruptcy yesterday and Matsushita Electric Industrial Co. today said it will shed 10,000 workers, a quarter more than planned.
``The increase in unemployment and bankruptcies, and a decline in wages will continue to depress spending,'' said Jesper Koll, chief economist at Merrill Lynch Japan Inc., who expects the economy to stay in recession until this time next year. ``We're a third of the way through the recession.'' |
