Recent data showed that the Japanese economy contracted for the first time since two quarters in the first quarter of 2022, as the restrictions to combat (Covid-19) negatively affected the service sector, while The increase in commodity prices created more pressure, which raised fears of a prolonged slowdown.
The government office data revealed that the third largest global economy declined on an annual basis by 1% in the first quarter of this year, which is less than analysts' expectations for a decline of 1.8%.
The data also revealed that this means a fall on a quarterly basis by 0.2% compared to market expectations of a decline of 0.4%.
This retreat represents a challenge to the direction of Prime Minister Fumio Kishida; To achieve growth and distribute wealth according to its neo-capitalist agenda, it also reinforces fears of sluggish growth and high inflation.
For the entire fiscal year 2021 that ended in March, the Japanese economy grew by 2.1%, the first in 3 years.
Economy Minister Daichiro Yamagiwa said the economy is not expected to return to pre-pandemic levels, but further decline is likely to be limited.
