Japan GDP Contracts Sharply

New figures show Japan’s economy contracted at its quickest pace in 35 years. Japan’s worse-than-expected fourth quarter GDP numbers were a sobering reminder of the toll on Asia’s export-driven economies as world demand collapses amid the worst slump in decades, the Associated Press reports. Japan, the world’s second-biggest economy shrank 3.3% from the previous quarter, or at an annual pace of 12.7%.

The result represents the steepest drop for Japan since the oil shock of 1974 and outpaced annual pace declines of 3.8% in the U.S. and 1.1% in the euro zone. Meanwhile, mainland China’s gains spread across an array of industries, with some resource firms especially strong. Baoshan Iron & Steel Ltd., the country’s biggest steelmaker, soared the daily limit of 10%.

Since the start of the year, Shanghai’s index has surged more than 31%. But analysts say the rise has been driven not by economic fundamentals but by a surge in bank lending that has sent money flowing into the market.