Japan's Economy contracted at its fastest quarterly pace in two years in the July-September period, due to rising domestic inflation and waning export demand. This marks the first decline in four quarters and highlights the challenges faced by Prime Minister Fumio Kishida and Bank of Japan Governor Kazuo Ueda. The provisional gross domestic product fell 2.1% compared to a year ago, its biggest contraction since 2021 and larger than the expected decline. The weak GDP print was driven by a decline in private demand and weaker-than-expected domestic capital expenditure. The Japanese government plans to implement an economic package to mitigate rising living costs.

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