Asian economies stumble

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New York : a top retail analyst said. The Standard & Poor's Retail index fell 1.6 per cent.

Consumers are cutting spending on nearly everything but necessities as they endure a housing slump, mounting job losses and the credit crunch.

"The recession is kicking in," said Tammy Williams, 36, as she waited to enter a New Jersey Kohl's Corp store. "I'm just looking for a bargain, anything to save a couple of dollars. I'll save the rest for food shopping."

Japan announced a fall of 3.1 per cent in industrial output for October, more than expected. Household spending in the world's No. 2 economy also fell more than expected.

DEEPER, LONGER

The Japanese data surprised economists and suggested the economy was in for a deeper and longer recession than earlier thought.

"Production is falling much faster than we had expected. Companies are adjusting their production very quickly," said Takumi Tsunoda, senior economist at Shinkin Central Bank Research. "The auto makers are the worst hit, but their turmoil is starting to spill over to other sectors, such as steel."

South Korea, Asia's fourth-biggest economy, followed Japan's pattern in reporting a sharp drop in factory output in October, leading some analysts to expect a recession.

India, like China a major contributor to global economic growth in recent years, reported better than expected growth of 7.6 per cent in the third quarter. But the economy lost momentum from the prior quarter's 7.9 per cent growth and prospects were clouded by the Mumbai attacks.

Consumer price inflation in the Euro zone fell 1.1 per centage points, the biggest drop since the zone was created 10 years ago, to 2.1 per cent year-on-year.

The continent's troubles were underscored in Sweden, which joined the growing number of nations officially in recession.