Japan economy shrinks historic 7.8% in second quarter

Japan's economy shrank 7.8 per cent in the April to June quarter, the worst contraction in the nation's modern history, as the coronavirus deepens the country's economic woes.

The contraction from the previous quarter was slightly worse than expectations but is still significantly less severe than declines seen in many other industrial economies.

Still, it is the biggest economic contraction for Japan since comparable data became available in 1980, beyond the brutal impact of the 2008 global financial crisis.

And some analysts labelled it the worst fall since World War II, though a change in calculation methods in 1980 makes the comparison complicated.

The official data compared with the market's expectation of a 7.6 per cent contraction, the median forecast of major economists surveyed by the Nikkei business daily.

It was the third straight quarter of negative growth, confirming a deepening recession for Japan, and raising the prospect that the government will consider pumping further stimulus into the economy.

Japan was already struggling with a stagnating economy and the impact of a consumption tax hike implemented last year before the pandemic hit.

It has seen a smaller coronavirus outbreak compared to some of the worst-hit countries, with infections approaching 55,000 and deaths at slightly under 1,100.

Ref: AFP