The Japanese economy contracted by 0.8% on an annualized basis in the third quarter, with economists’ median forecast for a 1.1% decline in a Reuters poll and an early official estimate of a contraction of 1.2%.
The higher shift in private inventories drove the revision, which compares to a 4.5% annualized quarterly gain in the prior quarter.
The Cabinet Office also announced a 64.1 billion yen ($469.3 million) deficit in the unadjusted current account balance on Thursday. A separate Reuters poll predicted a surplus of 623.4 billion yen, which was much lower than the reading.
Japan’s GDP dropped unexpectedly in the third quarter amid global recession fears, China’s weakening economy, a weak yen, and rising import costs harmed consumption and businesses.
According to some economists, the economy may improve in the current quarter as supply shortages on semiconductors and automobiles ease and Covid-19 border controls are lifted.