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Japan economy shrinks 0.3% in July-September
[TOKYO] Japan's economy shrank in the three months to September, official data showed Wednesday, after a string of natural disasters hit consumer spending and exports.
Gross domestic product for the July-September period contracted 0.3 per cent from the previous quarter, reversing growth of 0.8 per cent in the April-June quarter, according to the government's Cabinet Office.
A number of natural disasters dampened personal consumption, company investment and exports, said Katsunori Kitakura, lead strategist at Sumitomo Mitsui Trust Asset Management.
"Natural disasters forced consumers to stay indoors and halted factory operations, which led to a slowdown in production and investment activities," he said in a commentary ahead of the data release.
Japan was hit by several natural disasters this summer, including massive flooding in western regions due to torrential rains, a typhoon that inundated a major international airport, and an earthquake in the north that disrupted supply lines.
The temporary closure of the Kansai International Airport led to a fall in tourism and overseas shipments, Mr Kitakura said.
But he anticipated a rebound in the last quarter of the year thanks to a broadly solid global economy.
"Going forward, we remain optimistic that the economy will improve. While we remain cautious on China-US trade, the global economy continues to show solid growth and exports should continue to rise," he said.
SMBC Nikko Securities also said in an earlier report that "natural disasters are likely to have dampened exports of goods and spending by foreign visitors as well as personal consumption".