Recession risk grows in Japan as coronavirus clouds economic outlook – The National

Recession risk grows in Japan as coronavirus clouds economic outlook – The National

Recession risk grows in Japan as coronavirus clouds economic outlook. Japan's economy shrank at the fastest pace in almost six years in the December quarter as last year's sales tax hike hit consumer and business spending, highlighting a fragile outlook made worse by growing coronavirus risks.. Analysts say the widening fallout from the epidemic, which is damaging output and tourism, could undermine growth in the current quarter and push Japan into recession - defined as two straight quarters of decline.. "There's a pretty good chance the economy will suffer another contraction in January-March [quarter].. It was the biggest fall since the second quarter of 2014, when consumption took a hit from a sales tax hike in April of that year.. The latest sales tax hike in October last year - as well as unusually warm weather that hurt sales of winter items - weighed on private consumption, which sank a bigger-than-expected 2.9 per cent, marking the first drop in five quarters.. Combined, domestic demand knocked 2.1 percentage points off GDP growth, more than offsetting a 0.5 point contribution from external demand.. Japan's Economy Minister Yasutoshi Nishimura said the government was ready to take all necessary steps and was watching the