Japan GDP shrinks 4% in first quarter

Japanese economy shrank at a staggering pace of 4 per cent in the first three months of 2009, as the country continues to experience the jitters of the global financial turmoil.

The world's largest economy has contracted for the fourth straight quarter amid plunging profits and declining corporate earnings.

The latest figures released by the Japanese Cabinet Office today revealed that the nation's GDP dropped 4 per cent in the first quarter of this year, one of the worst showing ever.

In the fourth quarter of 2008, the export-oriented Japanese economy shrunk 3.8 per cent. The GDP had contracted 0.9 per cent and 0.6 per cent in the first and second quarters of last year, respectively.

Rattled by the global economic crisis, Japanese entities especially the auto makers are witnessing steep decline in sales. Many of them have resorted to massive layoffs to cut down on costs.

The world's largest economy US had contracted 6.1 per cent in the first quarter of this year while the economies of euro zone -- the 16 nations sharing the common currency euro -- dropped 2.5 per cent during the same period.

Many of the developed countries are in deep recession -- generally defined as two consecutive quarters of negative growth.