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Monday, 17th November 2008
In Business In Japan,

Japan succumbs to recession

Japan's economy has followed many of those in Europe by officially falling into recession.

Reuters reports that the country unexpectedly saw its economy shrink in the third quarter.

Economics minister Kaoru Yosano said he was unsurprised by the development and expressed his concern about the economy of neighbouring China.

"As data shows, China's economy seems to be slowing," he commented, adding: "We are seeing clear signs that the global financial crisis is also affecting BRICs economies."

Previously, forecasters predicted that Japan would narrowly avoid recession - its first for seven years.

Initially, the yen and the US dollar rose as investors diverted their cash from riskier assets and emerging markets, before rebounding in Tokyo, reports Forbes.

The Confederation of British Industry (CBI) has warned that the recession is likely to last longer than previously expected.

John Cridland, the deputy director-general of the CBI, commented: "What is clear is that the short and shallow recession we had hoped for a matter of months ago is now likely to be deeper and longer lasting."