Japan’s economy contracted by 7.1% in the three months to June, more than initial estimates, and revised from 6.8% reported in August. Most forecasts were for the economy to shrink by about 7%.
The contraction during the second quarter has been widely attributed to a hike in the nation’s sales tax, which rose from 5% to 8% in April. The official gross domestic product (GDP) figure of 7.1% is an annualised number.
In quarterly terms, the Japan’s economy, which is world’s third-largest economy, shrank by 1.8% in the three months to June compared to the quarter ending in March when it grew by 1.5%.