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Thursday, 19th May 2011
In Business In Japan,

Japan's economy back in decline after quake

The Japanese economy fell back towards another recession during the first quarter of this year, with the March 11th earthquake playing a large part in this.

Economy minister Kauro Yosano told AFP that the country's GDP declined by 0.9 per cent on a quarterly basis from January to March, bringing the annual slowdown to 3.7 per cent.

"The Japanese economy is expected to remain weak for the time-being," Mr Yosano admitted, although he added that there are signals suggesting some "resilience".

Analysts have suggested that this trend could continue into the next quarter, with Capital Economics saying that the impact of the quake "has only just begun to be reflected".

The announcement means that Japan's economy has contracted for two consecutive quarters for the first time since the global financial crisis of 2008/09.

Private consumption was one of driving factors behind the downturn, with Japanese self-restraint leading to a 0.6 per cent drop-off in consumer spending over the quarter.

Written by Mark Smith