Japan in recession

The Japanese economy shrank at an annual rate of 3.7 per cent in the first quarter, tipping it unofficially into a recession, as the March 11 earthquake and tsunami disrupted production and prompted consumers to cut spending.


Japan's economy has now contracted for two quarters in a row, the generally accepted definition of a recession. Japan sank into a recession during the global financial crisis, but had emerged from it in 2009.

The drop off was worse than economists had expected. In a survey of 23 economists, Bloomberg had projected an average drop of 1.9 per cent.

Portugal bail-out

Portugal needs financial assistance worth 78bn euros ($116bn; £70bn) (ouch!) and has been working on a deal with European Union (EU) and International Monetary Fund (IMF) for the past 3 weeks.

Basically, Portugal will be given more time to reach its budget deficit targets than had previously been expected. The interest rate on Portugal's bailout loan is expected to be set at a meeting of eurozone finance ministers in mid-May.

Now, the deficit will be cut to 5.9% of GDP this year, 4.5% in 2012 and 3% in 2013. Portugal previously aimed to reduce the deficit to 4.6% this year, 3% in 2012 and 2% in 2013.


Well, this sounds lovely but nothing is ever that easy!

Japan car sales halve!

The earthquake hit Japan on 11 March and (not surprisingly) we are still feeling the impact of the disaster.

The region that was worst hit by the magnitude-9.0 earthquake and the tsunami that followed was north-east Japan. This is where many important vehicle parts suppliers have factories and hence as a result, the industry's supply chain is in chaos, specifically, semiconductors and plastic parts.

According to data from the Japan Automobile Dealers Association (Jada), there is a shortage of parts which is affecting vehicle production. It was also states that this 51% fall from a year earlier was the biggest decline since records began in 1968.

How is this affecting companies?