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TOKYO – Japan's economy grew at a slower than forecast 0.2 percent annual rate in the April-June quarter, as the recovery was sapped by weaker exports and business investment, the government said Monday.
Growth for the world's third-largest economy was flat on a quarterly basis, adding to pressure on the Bank of Japan to take further action to stimulate slack corporate spending.
The economy expanded at a 0.5 percent rate in the January-March quarter. Economists had forecast that it would maintain or even slightly better that pace in April-June. But consumer demand, which accounts for nearly two-thirds of business activity, rose only 0.2 percent.
A recent strengthening in the value of the Japanese yen, and weaker oil prices, have slowed progress toward a 2 percent inflation target set by Abe and the central bank.
Moving to salvage his "Abenomics" strategy for fighting stagnation, Prime Minister Shinzo Abe recently proposed 28 trillion yen ($267 billion) in spending initiatives meant to get consumers and businesses to spend more money and support the stalling recovery.