Japan’s economy has shrunk 0.8% on an annualized basis in Q3 of 2015 and fell back into recession.
The preliminary data means the world’s third-largest economy has contracted for a second consecutive quarter, marking a technical recession.
Japan’s economic growth was expected to decline after it fell a revised 0.7% in Q2 on weak domestic demand.
The country has been in recession four times since the global financial crisis.
On a quarterly basis, growth fell 0.2% in the third quarter from the previous one, weaker than forecasts of a 0.1% decline.
The seasonally adjusted figure was also much lower than expectations of a 0.2% drop.
According to economists, the weak data will put more pressure on the government and central bank to continue to stimulate the economy.
Japanese companies continue to be wary of using their record profits to raise wages and invest in the economy – a major challenge for Prime Minister’s Shinzo Abe’s “Abenomics” policies.
Business spending fell 1.3%, against forecasts of a 0.4% decrease. It also marked the second quarter in a row of declines.
However, private consumption, which accounts for 60% of the economy rose 0.5% from the previous quarter.
Consumer spending has picked up from the hit it took last year from an increase in sales tax in April, which contributed to the recession in 2014.
Despite the declining growth, the government is positive that a recovery is underway.
In reaction to the growth figures, the benchmark Nikkei 225 index was down 1.1% to 19,372.98 points in early trade in Tokyo.