Tokyo – Japan’s economy shrank to a record, even worse rate than initially anticipated in the April-June quarter.
The Cabinet Office said on Tuesday that Japan’s seasonally adjusted real GDP contracted at an annual rate of 28.1%, which is worse than the 27.8% figure given last month.
The coronavirus epidemic, which causes people to vacate or close homes, restaurants and stores, and nose-diving travel and tourism, has hurt all the world’s economies and many companies. But it has slashed Japan’s export-dependent economy.
Voices of Japanese are heard during Japan’s economic crisis due to Japan’s economic crisis.
Restoring development will be a priority as the country prepares to choose a new leader in place of Prime Minister Shinzo Abe, who resigns for health reasons. A vote is expected next week among members of the governing party.
Other figures released on Tuesday showed some improvement in cash earnings, and a rebound is expected after a sharp decline in consumer spending and other business activities as the country sought to bring the coronovirus epidemic under control.
“However, high-frequency data suggest that growth is struggling to gain momentum, suggesting a very gradual and longer recovery after the initial boom. The near-term outlook therefore remains challenging,” Oxford Economics Said in a comment.
The economy contracted 7.9% quarter-on-quarter, according to revised figures, down from 7.8% in preliminary figures.
Japanese automobile drivers account for 12% of Japan’s automobile vehicles
The annual rate shows what the number would have been if it had continued for one year.
The Cabinet Office stated that the government began keeping comparable records in 1980. The previous worst contraction, down 17.8%, was in the first quarter of 2009 during the global financial crisis. But the latest drop is considered the worst since World War II.
Japan had already slipped into recession in the first quarter of this year, contracted by an annual 2.3%. It decreased 7.0% in the last quarter of the previous year. A recession is generally defined as two consecutive quarters of contraction. Last year, July-September growth was flat.
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Domestic demand declined in the second quarter of this year, as private investment fell. Public demand, driven by government spending, was also worse than before.
Abe focuses its “abenomics” policies, passing through super-easy lending and deregulation to the economy. This approach relied on monetary easing by the central bank and helped eliminate deflation. But it never achieved the sustainable growth rate targeted by Abe.
All candidates are expected to put those policies in place.