The economic outlook in Japan has just got worse. The world’s second-largest economy is even deeper in recession than first thought.
If the downward trend continues into next year, and a fourth straight quarter, it will mark a post-war record. Sales of Japanese exports have slumped in the global downturn. Manufacturers are slashing output, and jobs.
Sony has just cut 5 per cent of its global electronics workforce. It needs to save nearly a billion euros to stay afloat. As spending power diminishes worldwide, so inevitably will Sony’s profits. The sharp increase in the yen has harmed export sales too, as goods have become relatively so much more expensive.
The news that Japan’s economy had shrunk half a per cent from July to September, rather than a fifth of that as first though, slowed the tentative rebound the stock market had been enjoying.