The Japanese economy witnessed an unexpected contraction for the first time in the background of the high import bills in the third quarter, due to the decrease in the yen to its lowest levels in several decades. The gross domestic product from July to September shrinks by 1. 2% from the previous year, as Japan faced an increase in Corona during the summer; Which slowed the recovery of consumer spending of the largest advanced economy in Asia. According to the Financial Times.
Economists expect growth to rise near the end of the year with the return of tourism and the offering of a 200 billion dollar prime mino spending package to reduce the impact on families due to the high prices of basic commodities and the weakness of the yen. The decrease in the GDP of Japan contrasts with the expectations of economists by 1. 1%, and growth in the second quarter by 4. 6%, and data were translated into a real quarterly decrease of 0. 3%, compared to 0.
3%growth expectations, according to the initial figures issued by the Cabinet Office , Tuesday.
Families continued to rise, but only 0. 3 % compared to 1. 3 % in the second quarter, as the accumulated savings during the consumer epidemic helped to bear the high costs of living.
Export growth exceeded 1. 9% on a large scale and an increase of 5. 2% in the Japanese import bill, which reflects the weakness of the yen and the commercial environment.
Since September, the Japanese authorities have implemented multiple interventions to support the yen, which decreased to its lowest level in 32 years last month due to the widening gap between the cautious monetary policy of Japan Bank and the emphasis by most other major central banks.
The real total local income fell more than expected by 3. 9% during the quarter.
The decline indicates more risks of decline in the economy, as slow wage growth means that consumer spending may not grow strongly to exceed the expected demand caused by the epidemic.
Economists expect Japan to outperform the other advanced economies next year, as they still have a field for more recovery from the epidemic, and the economy will receive support from government spending and the loose policy of Japan.
They added, “It is difficult to be optimistic about the expectations of the Japanese economy only because of the stimulus measures, as the feeling of economic impact will begin to tighten by central banks worldwide as of next year, and the Japanese economy will slow if the economy is abroad. “.
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