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Japan cuts July-September economic growth estimate to 1.1 percent

  • A man scratches his head as he looks at an electronic stock board of a securities firm in Tokyo, Monday, Dec. 9, 2013. Japan has revised its economic growth estimate for the last quarter downward after finding that capital investment slowed more than expected in July-September. The government said Monday that the world's third-largest economy grew an annualized 1.1 percent in the last quarter, less than half the pace of the previous quarter. The previous estimate had put growth at 1.9 percent. (AP Photo/Koji Sasahara)The Associated Press

  • People walk by an electronic stock board of a securities firm in Tokyo, Monday, Dec. 9, 2013. Japan has revised its economic growth estimate for the last quarter downward after finding that capital investment slowed more than expected in July-September. (AP Photo/Koji Sasahara)The Associated Press

  • People walk by an electronic stock board of a securities firm in Tokyo Monday, Dec. 9, 2013. Japan has revised its economic growth estimate for the last quarter downward after finding that capital investment slowed more than expected in July-September. (AP Photo/Koji Sasahara)The Associated Press

Japan slashed its estimate of economic growth for the July-September quarter Monday as investment by companies slowed more than first estimated.

The government said the world's third-largest economy grew an annualized 1.1 percent last quarter, less than half the pace of the previous quarter. The initial estimate had put growth at 1.9 percent.

Prime Minister Shinzo Abe's economic revival strategy for Japan centers on cheap credit, a weak yen and longer-term reforms to boost competitiveness, but corporate investment and personal incomes have yet to rebound. Meanwhile, exports have grown less than expected despite the weaker yen, partly due to slowing growth in many emerging economies.

Japan's economy grew at a 4.3 percent pace in the first quarter of the year and 3.8 percent in April-June.

The revised data for the third quarter showed that the economy expanded 0.3 percent from the second quarter. The original estimate was 0.5 percent quarter-on-quarter growth.

As the U.S. has moved toward a possible reduction of its monetary easing, Japan's central bank has reaffirmed its commitment to pumping money into the economy to achieve an inflation target of 2 percent by 2015. Prices have only just begun to rise, but most of the increase has been attributed to rising costs for fuel and other imports.

The revised data Monday showed slower foreign and domestic demand than originally thought.

Private investment, excluding residential investment, was flat. Economic growth was supported by a 6.5 percent increase year-on-year in public spending, reflecting the government's boost in infrastructure investment and stepped up reconstruction in the areas devastated by the March 2011 tsunami.