The economic slump deepened in August as industrial production fell at its fastest pace in at least five years, household spending tumbled and the unemployment rate rose to a two-year high, government figures showed Tuesday.
Factory output dropped 3.5 percent from July, the Ministry of Economy, Trade and Industry said. The jobless rate climbed to 4.2 percent and purchases by households dropped 4 percent, the most since September 2006, the Internal Affairs and Communications Ministry said.
"The biggest concern now is the outlook for exports, which is becoming more severe," said Takahide Kiuchi, chief economist at Nomura Securities Co. "We're expecting a mild recession toward the end of the year, but there is a chance that we'll see a more pronounced adjustment."