Japan's economic growth accelerated more than expected in the third quarter due to last-minute gains in consumption before government stimulus measures expired.

But many analysts expect growth to slow, or even contract, in the fourth quarter as companies feel the effects of a strong yen[JPY=X  82.7    0.26  (+0.32%)   ], slowing exports and the fading effect of stimulus measures that boosted demand for low-emission cars before expiring in September.

Should the yen start rising again, that could prompt the Bank of Japan to ease policy further to avoid a prolonged slump.

"Third-quarter growth relied heavily on domestic demand, and this suggests a marked slowdown in the final quarter as stimulus-driven consumption loses steam and export growth slows," said Junko Nishioka, Japan chief economist at RBS Securities.

Japan's gross domestic product (GDP) grew 0.9 percent in July-September from the previous quarter, accelerating from a 0.4 percent gain in the second quarter and beating the median forecast for a 0.6 percent rise, Cabinet Office data showed on Monday.

The expansion translates into an annualized gain of 3.9 percent, exceeding the annualized expansion of 2.0 percent in the U.S. during the same period.

Japan's economy is likely to resume expansion next year as overseas demand stabilizes, but recent signs of weakness in capital expenditure and manufacturing activity suggest the rebound could be slow.

The yen's surge this year and the chance that China's economy could slow next year as it tightens monetary policy pose risks to Japan's outlook.

Private consumption, which accounts for about 60 percent of the economy, rose 1.1 percent against a 0.9 percent gain expected by economists.

In a sign of slowing external demand, net exports made no contribution to growth in July-September after a contribution of 0.3 percentage point in April-June.

Capital expenditure rose 0.8 percent, compared with a 0.7 percent increase forecast by economists.

Japan emerged from its worst recession since World War Two in the second quarter of 2009, but growth has been spotty due to a lackluster labor market and slow gains in corporate spending.

Economists polled by Reuters expect Japan's economy to contract 0.1 percent in October-December before heading back to a moderate expansion.