"The drop was mainly due to weak exports exacerbated by slowing global demand and the impact of the Thai floods"
- Maruyama, chief economist at Itochu Corp.
Japan's economy contracted between October and December as Thai floods and strong yen weighed on exporters. The gross domestic product fell 0.6 per cent, compared to the previous three months, said the Cabinet Office on Monday.
"The drop was mainly due to weak exports exacerbated by slowing global demand and the impact of the Thai floods," Yoshimasa Maruyama, chief economist at Itochu Corp., said in Tokyo on Monday.
The central bank may reserve more easing for any "excessive yen gains and a deterioration in overseas economies," Maruyama added.
"This is a contraction driven by external demand. Exports have fallen a lot because of a triple shock from Europe, the strong yen and floods in Thailand," said Hiroaki Muto, senior economist at Sumitomo Mitsui Asset Management Co in Tokyo.
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