(RTTNews) - Japan's government downgraded its economic assessment for the first time since January citing the weakness in business investment.
"The Japanese economy is recovering at a moderate pace, although it recently appears to be pausing in part," the Cabinet Office said in a report.
For six straight months until October, the government had said the economy is recovering at a moderate pace.
The government warned that slowing down of global economies is a downside risk for the Japanese economy, including the effects of global monetary tightening and the concern about the prospect of the Chinese economy.
Cutting the assessment about the business investment, the government said it appears to be pausing for picking up. The government retained its view on other components in November. The downgrade came after the third quarter GDP data released last week showed that the Japanese economy contracted 0.5 percent sequentially.
The economy shrank 2.1 percent year-on-year, reversing the 4.8 percent expansion in the second quarter. The contraction reflected the falling business spending and private consumption.
Earlier this month, the government approved an extra budget plan of JPY 13.2 trillion for the fiscal year ending March in order to alleviate the cost of living crisis.
The supplementary budget will provide JPY 70,000 handouts to low-income households who are exempt from paying tax.
