February 18: The U.K. and Japan entered into recessions at the end of last year as cutbacks in spending by consumers took a toll on their economies, data released recently show.

The weakness in the two major economies is in stark contrast to that of the U.S. economy, which grew at an annualized rate of 3.3% in the fourth quarter, far faster than the 2% economists were expecting.

The U.K.’s gross domestic product shrank by an annualized rate of 1.4% in the final three months of 2023, in its second consecutive quarterly decline—the technical definition of a recession.

GDP in the U.K. fell 0.3% in the three months to December versus the previous three months, following a 0.1% decline in the third quarter, according to data from the Office for National Statistics.

During the last three months of 2023, Japan’s GDP contracted at an annualized pace of 0.4%, after falling 3.3% retreat in the previous quarter, according to government data.

Japan’s shrinking economy is now the fourth-largest in the world, losing its spot in the top three behind the U.S. and China to Germany. (Agencies)