Japan's economy shrinks in third quarter on import costs

Japan's economy shrank in the three months to September, official data showed Tuesday, due to high import costs and weak private consumption despite the end of Covid-19 restrictions.

It follows three consecutive quarters of growth, after an initial negative reading in the first quarter was revised upwards. Corporate investment was up in the period but private residential investment declined, while an increase in import costs overwhelmed an increase in exports, the cabinet office said.

The world's third-largest economy contracted 0.3 percent quarter-on-quarter, missing market expectations of 0.3 percent growth, the data showed.

Analysts had predicted a pick-up in consumption, but acknowledged ahead of the data release that Japan faced headwinds from its trade situation, with sky-high prices for commodities such as oil pushing up import costs.

A slower global economy, which is "is likely to be dragged down by tightening in monetary policy, zero-Covid policy in China and geopolitical uncertainties," is also a negative factor for Japan, UBS economists Masamichi Adachi and Go Kurihara said.

"On top of these factors, the secular drag from a shrinking and aging population and low medium-to-longterm growth expectations cannot be ignored," they added.

Last month, Japanese Prime Minister Fumio Kishida announced a $260 billion stimulus package to cushion the economy from the impact of inflation and the weak yen.

The Japanese currency has tumbled from about 115 against the dollar before Russia's invasion of Ukraine to around 140 on Tuesday, although it has retreated from recent multi-decade lows of less than 151 yen.

President Nana Akufo-Addo on Monday fired Ghana's junior finance minister over corruption allegations made in an upcoming documentary on illegal gold mining.

The president has "terminated the appointment of the Minister of State at the Ministry of Finance, Mr Charles Adu Boahen, with immediate effect," he said in a statement.

The fallout from the expose comes the government is under pressure over Ghana's economic crisis and lawmakers push Akufo-Addo to fire Finance Minister Kenneth Ofori-Atta.

The presidency's statement said Akufo-Addo's decision came after "being made aware of the allegations" against Boahen in the documentary "Galamsey Economy," which is scheduled to be released on Monday.

Akufo-Addo also referred the case to prosecutors for further investigation.

Teasers from the expose show

Boahen in what the documentary claims are images of him trying to demand $200,000 from potential investors to give to the vice president to allow them to do business.

Galamsey is a local Ghanaian phrase referring to the illegal or unregulated, small-scale gold mining operations. Boahen has not commented on the allegations made in the teasers.

But before the sacking was announced, Vice President Mahamudu Bawumia on Monday said he was not aware of any meeting in which Boahen had used his name to "peddle influence and collect money from supposed investors." "If what the minister is alleged to have said is accurately captured in the video, then his position as a minister of state is untenable," he wrote on Twitter.

"I will not allow anyone to use my name to engage in corrupt activities."

Akufo-Addo has been under increasing pressure after recently opening negotiations with the International Monetary Fund (IMF) over a potential $3 billion loan to help shore up the country's economy.

Last month he appealed to Ghanaians to support his efforts to manage the "crisis" as inflation has hit 40 percent and the national currency, the cedi, has dropped sharply.

Wall Street's major indexes rallied on Monday as investors looked to the U.S. midterm elections and a key U.S. inflation report.