The government is expected to cut its growth projection for the Japanese economy for fiscal 2016 to 0.9 percent in price-adjusted terms from 1.7 percent due to the absence of last-minute purchases, given the postponement of the consumption tax hike, sources said Tuesday.

Before Prime Minister Shinzo Abe said last month he is pushing back the planned consumption tax hike to October 2019 from April 2017, last-minute demand was expected to occur in the latter half of fiscal 2016, which ends next March, and boost Japan's gross domestic product.

Also contributing to the planned downward revision from the government's previous forecast in January are sluggish consumer spending and increased uncertainties over the global economy, they added.

The government is expected to present its new growth outlook at a meeting of the council on fiscal and economic policy on Wednesday after taking into account Japanese businesses possibly growing cautious about making fresh capital investment given the yen's rise against the dollar following Britain's decision to leave the European Union.

Abe ordered his ministers Tuesday to compile economic stimulus measures by the end of this month, but its impact is not reflected in the new economic outlook.

The nominal growth rate for fiscal 2016 is expected to be forecast at around 2.2 percent, down from the previous forecast of 3.1 percent.

For fiscal 2017, the government is likely to project Japan's economy to expand around 1.2 percent in real terms and 2.2 percent in nominal terms, the sources said.