Japan’s Economy Declined by 0.3% in 3Q2022 as Private Consumption Slowed

photo credit: AMRO Asia

The world’s third -largest economy contracted 0.3 percent during July-September, according to official data released on Tuesday, after three consecutive quarters of growth.

Japan’s economy contracted unexpectedly in the third quarter as private consumption slowed and import costs rose.

This economic performance translates into an annualised contraction of 1.2 percent.

Private consumption, which accounts for more than half of Japan’s $5 trillion economy, rose 0.3 percent, well below the previous quarter’s 1.2 percent gain.

On the contrary, corporate investment rose, private residential investment fell.

Meanwhile, a surge in import costs offset a 1.9 percent gain in exports, according to the official data.

Japan has been grappling with a weakened yen, which has exacerbated rising cost-of-living pressures for households and businesses. The Japanese currency plunged to a 32-year low in October, hitting 151 yen to the US dollar, although it has since recovered some of its losses.

Japanese Prime Minister Fumio Kishida had unveiled a $260bn stimulus package aimed at propping up the economy last month.

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