The Japanese government reports that the country’s actual GDP shrank by 14.2 per cent in the first quarter of 2009 – the largest drop in its post-war history. However, the figure is better by a percentage point than some estimates made last month.

Figures for the whole of the 2008 fiscal year had been forecast to contract 3.5 per cent but instead showed a decline of 3.3 per cent – which, despite being better than expected, was still a 60-year low.

Nonetheless, the figures are being viewed as evidence that Japan is coming through the worst of its economic downturn, with government officials looking to the second quarter of 2009 as the first period of growth for 15 months.

Meanwhile, private sector economists are predicting a one per cent uptick in GDP from April to June this year followed by two per cent growth for July to September 2009 – largely due to a financial stimulus package the Government released in April.