The economy contracted in the third quarter on sluggish business investment, confirming what many economists had predicted: The nation fell into its second recession since Prime Minister Shinzo Abe took office in December 2012.

Gross domestic product declined an annualized 0.8 percent in the three months ended Sept. 30, following a revised 0.7 drop in the second quarter, the Cabinet Office said Monday. Economists had estimated a 0.2 percent decline for the third quarter.

Concerns about a Chinese-led slowdown apparently weighed on consumption, which accounts for around 60 percent of Japan's GDP, and capital spending, raising the bar for Abe's government to stimulate demand and steer the economy toward growth.