Japan’s economy shrank an annualized 2.3 percent in the fourth quarter as exports slid, the biggest decline since a record earthquake dragged down growth in the first three months of last year.
The contraction compared with the median forecast for a 1.3 percent decline in a Bloomberg News survey of 26 economists. Growth was a revised 7 percent in the previous quarter, the Cabinet Office said today in Tokyo.
Today’s report bolsters the case for Bank of Japan (8301) officials, meeting today and tomorrow, to consider more monetary easing as gains in the yen pare export earnings, worsening losses for companies such as Sony Corp. (6758) Manufacturers have also been hurt by flooding in Thailand that disrupted production, while energy imports because of nuclear shutdowns led to the first annual trade deficit since 1980.
“Japan’s economy will likely remain vulnerable to a slowdown in global demand and the yen’s appreciation,” Kiichi Murashima, chief economist at Citigroup Global Markets Japan Inc. in Tokyo, said before the report.
The yield on the benchmark 10-year Japanese government bond was little changed at 0.98 percent after the data, according to data compiled by Bloomberg.
