Japan's risk of an economic contraction this quarter has increased as faltering demand from Europe to China drags down exports, strengthening the case for more government measures to support growth.
JPMorgan Securities Japan Co. forecasts a 0.3 percent annualized decline in gross domestic product in the three months through September after previously seeing 1 percent growth. BNP Paribas SA estimates a 0.9 percent fall after earlier predicting no change.
China's failure to secure an economic rebound is adding to austerity measures in Europe and unemployment in the U.S. in limiting prospects for Japanese trade and growth. Pressure may build for an extra government budget and additional stimulus from the Bank of Japan as subsidies for purchases of fuel-efficient cars wind down, damping consumer spending.
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