After delivering a much-anticipated statement on Japan's war legacy and engaging in a bruising legislative fight over defense laws, Prime Minister Shinzo Abe got a reminder on why he needs to return his focus to the economy.
With tepid wage growth making consumers unwilling to spend, the world's third-biggest economy snapped two quarters of expansion to contract 1.6 percent in the three months through June, slightly better than the median forecast of a 1.8 percent fall.
At a time when the economy was losing momentum, Abe's agenda was dominated by the war statement — key to improving relations with China and South Korea — and the fight to boost the role of the military. That battle led to a plunge in his popularity that could hamper his efforts to push ahead with some unpopular measures to revive growth.