Japan slips into recession, loses spot as world’s third-largest economy to Germany

Japan’s economy unexpectedly slipped into a recession on Thursday and the country has lost its spot as the world’s third-largest economy.

Weak domestic demand has weighed on Japan’s economy and led to an unexpected shrinking for the second consecutive quarter, raising uncertainty about the central bank’s plans to exit its ultra-easy policy sometime this year.

Two consecutive quarters of contraction are typically considered the definition of a technical recession.