Japan39;s GDP shrinks for two straight quarters
Frail consumption, capital spending point to challenging outlook
Supply constraints may be delaying execution of spending plans
Some analysts push back bets of an early exit to negative rates

TOKYO, Feb 15 Reuters Japan unexpectedly slipped into a recession at the end of last year, losing its title as the world39;s thirdbiggest economy to Germany and raising doubts about when the central bank would begin to exit its decadelong ultraloose monetary policy.

Some analysts are warning of another contraction in the current quarter as weak demand in China, sluggish consumption and production halts at a unit of Toyota Motor Corp all point to a challenging path to an economic recovery.

What39;s particularly striking is the sluggishness in consumption and capital expenditure that are key pillars of domestic demand, said Yoshiki Shinke, senior executive economist at Daiichi Life Research Institute.

The economy will continue to lack momentum for the time being with no key drivers of growth.

Japan39;s gross domestic product GDP fell an annualised 0.4 in the OctoberDecember period after a 3.3 slump in the previous quarter, government data showed on Thursday, confounding market forecasts for a 1.4 increase.

Two consecutive quarters of contraction are typically considered the definition of a technical recession.

While many analysts still expect the Bank of Japan to phase out its massive monetary stimulus this year, the weak…