The government has slashed its domestic economic growth projection for this fiscal year because an anticipated purchasing surge did not materialize after the second stage of a consumption tax hike was postponed.
Given Wednesday's reassessment, the government now expects the economy to grow 0.9 percent in real terms in the year through March from the previous year, down from 1.7 percent forecast in January.
"Uncertainty over the global economy has increased, while the domestic economy lacks strength in the private sector from factors like private consumption and business investment," the Cabinet Office said in a document presented to a government policy panel.