Japan – the world’s third-largest economy – shrank in the third quarter for the first time since last year.
The figures add to signs that slowing global growth and tensions with China are nudging the country towards recession.
The fall in GDP by just under one percent was expected, though a decline in capital expenditure was much steeper than forecast.
In the country’s ailing electronics sector, Sony plans to reduce capital spending by around 29 percent while Panasonic are looking at a 27 percent cut.
Economy minister Seiji Maehara said, “I cannot deny that Japan has fallen into a recession phase,” after the data was released.