IMF cuts Japan growth forecasts, warns over deflation

[HONG KONG] The International Monetary Fund Tuesday cut its growth forecast for Japan, saying the economy would shrink next year as a sales tax rise dents consumer spending, while it warned over a return to deflation.

The world's number three economy will expand 0.5 per cent this year and then contract 0.1 per cent in 2017, the Washington-based IMF said, reversing an earlier forecast for a 1.0 per cent and 0.3 per cent expansion respectively.

AFP