The world`s third-largest economy stalled in the April to June quarter, fresh data from Tokyo showed Monday.
Growth was flat at 0.0 percent quarter on quarter, missing market forecasts and rekindling worries about the government`s faltering bid to stoke the economy.
On an annualized basis, Japan logged a slight 0.2-percent expansion, well off expectations by analysts of a 0.7-percent rise.
Alarm bells ringing
"The situation is becoming tougher and tougher," Sumitomo Mitsui Banking`s Chief Economist, Junko Nishioka, said in a statement. "Companies are becoming more pessimistic about making investments."
Business confidence in the county has indeed slumped to levels last seen when Shinzo Abe came to power in late 2012 on a ticket to kick-start the economy beset by years of falling consumer prices and weak growth.
The latest growth figures have put more pressure on the Bank of Japan to unleash additional stimulus.
The central bank holds its next policy meeting in September. Back in July, governors opted to leave their annual bond-buying program unchanged despite signs of disappointing growth.
The yen weakened Monday against the greenback and the euro, making Japanese exports a tiny bit cheaper on overseas markets.
Japanese yen weakens on poor GDP data
15 August 2016
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Weak second-quarter growth in Japan has ratcheted up the pressure on the central bank to provide even more stimulus to the ailing economy. The yen eased on the latest GDP data - good for domestic exporters.
