The nation’s economy in the July-September period suffered the second quarterly contraction in a row, worse than even the most pessimistic forecasts by private-sector economists. While the weak gross domestic product data is being cited to justify postponing the second phase of the consumption tax hike, it appears to highlight contradictions in the economic policies pursued by Prime Minister Shinzo Abe’s administration over the past two years.

The July-September GDP fell an annualized 1.6 percent from the April-June period, when the economy declined 7.3 percent from the preceding three months — the sharpest fall since the first quarter of 2009 amid the global recession. It not only defied the earlier scenario that the economy would quickly bounce back from the falloff in demand after the April 1 hike in the consumption tax rate to 8 percent from 5 percent, but also more recent forecasts by economists that the recovery in the July-September period would only be a modest one.

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