Japan's reconstruction-fueled rebound waned in the second quarter as consumer spending growth almost stalled and export gains diminished, increasing the chance for monetary and fiscal stimulus.

Gross domestic product advanced an annualized 1.4 percent in the three months through June, less than the median estimate of 2.3 percent in a Bloomberg News survey of economists and down from 5.5 percent the previous quarter, a Cabinet Office report showed in Tokyo today. Unadjusted for prices, GDP contracted at a 0.6 percent annual pace.

Consumption rose the least since households cut spending in the immediate aftermath of the March 2011 earthquake, signaling a fading boost from government incentives that have supported domestic demand. With yen strength and Europe's crisis curbing exports, today's report escalates pressure on policy makers to head off a deeper slowdown in the world's third-largest economy.