Japan's gross domestic product gap in the October-December 2013 quarter narrowed for the fourth consecutive quarter, indicating the economy is moving closer to ending deflation, the Cabinet Office said Monday.

The fourth quarter gap between actual and potential GDP, or total domestic output of goods and services, fell from 1.6 percent in the July-September quarter to 1.5 percent, the narrowest since the July-September 2008 quarter, the Cabinet Office said in a preliminary report.

The gap, or a demand shortfall, translated into some ¥8 trillion in annualized value terms.

The GDP gap for the whole of 2013 shrank to 1.9 percent from 2.7 percent in 2012.