Figures this morning show that Japan's economic growth accelerated in the third quarter of this year as expiring government measures gave spending a last boost before a long-anticipated slowdown that analysts say is already under way.
Many economists expect the economy to stall or even shrink slightly in the next two quarters as the strong yen's damage to exports becomes more evident and factory output slumps after incentives for buyers of low-emission cars expired in September.
While few expect Japan to slip back into recession, policymakers remain alert to risks to the fragile economy.
Japan's gross domestic product grew by a better than expected 0.9% in July-September from the previous quarter, accelerating from a 0.4% rise in the second quarter.
The fourth straight quarter of growth translates into an annualised rise of 3.9%, nearly double the rate of US growth in the same period.
But Japan's government saw little to cheer about, with economics minister Banri Kaieda warning that slowing overseas growth and the strong yen could threaten the outlook. 'Japan's economy is at a standstill with weakness in production,' he said in a statement issued after the data.
Japan emerged from its worst recession since World War Two in the second quarter of 2009, but growth has been spotty due to a lacklustre labour market and slow gains in corporate spending.
