Japan’s economy fell into recession for the third consecutive quarter as exports and consumer spending dropped due to the aftermath of earthquakes and tsunami in March, reported the Japanese Cabinet Office on August 15.
During the second quarter of 2011, Japan ’s economic growth rate contracted by 0.3 percent from the first quarter, down 1.3 percent over the same period of last year.
Meanwhile, the consumer price index fell 0.1 percent and exports dropped 4.9 percent compared to the first quarter, the sharpest decline over the past two years. This was attributable to a strong JPY, a slump in domestic industrial production and slowing overseas economies.
Additionally, the gross domestic product (GDP) saw a year-on-year decrease of 5.7 percent and a quarter-to-quarter fall of 1.4 percent.
On August 12, the Japanese Cabinet Office lowered this year’s economic growth forecast to 1 percent from 1.5 percent in the previous report. However, it forecast that the economy would grow between 2.7 and 2.9 percent in the fiscal year 2012.
Economists from Japan ’s NLI Research Institute said the country’s economy is likely to strongly recover in the next quarter./.