HIGHLIGHTS 2-Japan economy shrinks on weaker exports, price jump

(For more stories on the Japanese economy, click [ID:nECONJP])

TOKYO, Aug 13 (Reuters) - Japan's economy shrank 0.6 percent in April-June from the previous quarter, matching market expectations and ending three quarters of expansion on weaker exports and the effect of higher prices on consumption.

The government data released on Wednesday underscored growing fears that the world's second-largest economy is either slipping into a recession or is already in one.

Following are key points of the preliminary data for gross domestic product, the broadest measure of the economy, with details from a briefing by a Cabinet Office official and a news conference by Economy Minister Kaoru Yosano.

- - - -

- The fall of 0.6 percent in GDP was the biggest since July-September of 2001, when the economy shrank 1.1 percent.

- Private consumption, which accounts for some 55 percent of GDP, fell 0.5 percent. That marked its first drop since July-September 2006, when it fell 0.6 percent. Spending on dining out, oil, electricity and confectionery fell, the official said.

- Exports fell for the first time since January-March 2005. Shipments to Europe slumped although exports to Asia and the United States increased, a government official said.

- Imports dropped for the first time since April-June 2003.

- Growth for January-March was revised down to 0.8 percent from 1.0 percent and that for October-December last year was revised down to 0.6 from 0.8 percent.

- For a graphic, click here

ECONOMY KAORU YOSANO'S NEWS CONFERENCE

"We should note that the contraction may be a reaction to high growth in the preceding quarter. But as we've said we think the economy is weakening and downside risk exists. It is natural that consumers practice thrift when prices are rising ...

"There are many strong points in the Japanese economy. Overall, I believe the Japanese economy will be firm. Even though the economy contracted in April-June, it would be more accurate to think that it won't last long as the economy slumped on external factors ...

"I hope we'll have positive growth as soon as possible ... The fall in GDP this time is due to external factors which Japan cannot control. I hope the impact of such factors will diminish.

"But we are not just hoping. The government will make efforts to make effective measures for the economy." (Reporting by Hideyuki Sano; Editing by Michael Watson)