"The weak data does reinforce our expectations that the Bank of Japan will come in with additional monetary stimulus and we are looking at an additional 10 trillion yen perhaps this year," he added.
The BOJ concludes a two-day policy meeting on Tuesday and is not expected to make any changes to its monetary policy given that it already has a hefty asset-purchase program in place.
Analysts have been anticipating an expansion of that stimulus to offset the impact of a planned rise in Japan's sales tax in April.
(Read more: Why lowering Japan's inflation target would be a mistake)
"The BOJ is probably not seriously going to change monetary policy until April," Sean Callow, senior currency strategist at Westpac Bank in Sydney, said.
Japanese markets appeared to shrug off the weaker-than-expected economic data in their stride, with the benchmark Nikkei-225 stock index opening 0.2 percent higher.
Still, the slowing momentum in Japan's economy was a worrying sign especially as the country braces for the impact of the sales-tax hike, analysts said.
"The momentum has gone in Japan," said Paul Donovan, deputy head of global economics at UBS. "What would help Abe is the TPP [Trans-Pacific Partnership].That [trade deal] would give [Prime Minister Shinzo] Abe an external force to go to the internal grups that areresisting change."
(Read more: Japan's PM keen to cut corporate tax)
Analysts added that Monday's data was likely to re-focus attention on Abe's long-term agenda for reviving the Japan's economy, which for years has grappled with poor economic growth and deflation.
Abe is determined to cut Japan's corporate tax rate, Chief Cabinet Secretary Yoshihide Suga told Reuters at the weekend.
Such a move is seen as a necessary step to boost the global competitiveness of corporate Japan and make the country more attractive to foreign investment.
"Corporate reforms do appear to be taking their time but we could see a corporate tax cut of 2-3 percentage points over the next six months," said Liew UOB.
-By CNBC's Dhara Ranasinghe. Follow her on Twitter at