Japan Economy Shrinks, Recession?

Japans economy shrank in the September quarter for the first time since last year, adding to signs that slowing global growth and tensions with China are nudging the worlds third-largest economy into recession.

The 0.9 percent fall in GDP was in line with expectations, although a decline in capital expenditure was much steeper than forecast. Sony Corp and Panasonic Corp have slashed spending plans to cope with massive losses as they struggle with competitive markets and a strong yen.

The fall in GDP translated into an annualized rate of decline of 3.5 percent, government data showed on Monday. While U.S. growth showed a modest pick up in the third quarter, Japan and the euro zone economies are shrinking.

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