The government looks set to revise downward its economic forecast for fiscal 2001 to negative growth of around minus 0.9 percent from its original projection of 1.7 percent growth, government sources said Tuesday.

Heizo Takenaka, state minister in charge of economic and fiscal policy, is expected to report the revised figure at a Cabinet meeting Friday, the sources said.

If minus growth is confirmed for the year, it would be the first time since fiscal 1998 that the economy will have contracted. Fiscal 1998 saw a 0.6 percent contraction. Takenaka has indicated the economy may contract in fiscal 2002 as well.