Japan’s economy sinks into contraction as spending, investment decline

By YURI KAGEYAMA
AP Business Writer

TOKYO (AP) — Japan has reported that its economy contracted at a 2.1% annual pace in July-September as consumption and investment weakened. Slowing wage growth in the world’s third-largest economy also sapped its vitality. The Cabinet Office said Wednesday in quarterly terms the economy contracted by 0.5%. The numbers were far worse than what analysts had expected. Private consumption shrank an annualized 0.2%. Corporate investment decreased 2.5%. With investment and demand weakening in other major economies, Japan’s economy is forecast to slow further in coming months. Prime Minister Fumio Kishida recently announced a stimulus package of more than 17 trillion yen ($113 billion) to help spur growth and help low income households at a time when prices have been rising.