Japan's GDP shrank in Q3 as inflation saps consumer demand

Annualized 2.1% contraction reflects weak consumption and investment

20231114 Japan consumption

A shopper looks for an air conditioner at a Tokyo electronics store in July. Inflation continued to bite Japanese consumers in the third quarter. (Photo by Mayumi Tsumita)

CHIHIRO ISHIKAWA, Nikkei staff writer

TOKYO -- Japan's economy shrank an annualized 2.1% in the July-September period from the previous quarter, according to preliminary figures released on Wednesday by the Cabinet Office, marking the first contraction in three quarters.

The latest gross domestic product growth rate compares with a median forecast of a 0.6% decline among economists surveyed by QUICK, a Nikkei group company.

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