Japan's government has revised downward its projection of the country's economic growth this fiscal year, citing a slow recovery in automobile exports as the main reason.

The Cabinet Office on Friday released its latest forecast for the year through next March. The gross domestic product is now expected to grow by 0.7 percent in inflation-adjusted terms.

That's down 0.2 points from the July forecast. The economy is expected to expand at a slower pace than last year's 0.8 percent.

Some of the leading Japanese automakers halted production after they were found to have manipulated safety testing data to get government certification for their models.

The Cabinet Office forecasts that the overall consumer price index will be 2.6 percent, staying at a high level following last fiscal year's 3.0 percent.

Attention is focused on whether expected wage increases will sustainably outpace inflation.

Meanwhile, inflation-adjusted growth in the next fiscal year is projected to be 1.2 percent, as personal spending is likely to recover and corporate investment is expected to remain solid.