* U.S. Q4 GDP down 3.8 percent, sharpest fall since 1982
* Japan industrial output falls record 9.6 percent in December
* Hitachi warns of record loss, NEC to slash 20,000 jobs
* Euro zone inflation fall points to ECB rate cut
By Dan Lalor
LONDON, Jan 30 (Reuters) - The U.S. economy is shrinking at its fastest rate since 1982, Japan has fallen into deeper recession and tumbling inflation in the euro zone is spurring expectations for an interest rate cut.
U.S. gross domestic product (GDP) fell an annualised 3.8 percent in the fourth quarter of 2008, better than forecasts for a 5.4 percent decline but still the sharpest fall since the first quarter of 1982.
Spending on cars, furniture and other durable goods plunged 22.4 percent in the steepest decline since 1987.
In Japan, rising unemployment, slowing household spending and a dim industrial outlook added to investors' fears that Japan was flirting with deflation and would post a horror fourth-quarter GDP figure.
Japan's biggest electronics maker, Hitachi Ltd, warned on Friday it faced the biggest ever annual loss by a Japanese manufacturer while chipmaker NEC Corp announced 20,000 job cuts, the biggest cutback in Asia since the financial crisis began.
Japan's quarterly GDP data, due in February, are expected to show its economy fell at a double-digit rate.
Industrial production fell a record 9.6 percent in December, with companies cutting output of cars, electronics and machinery while annual core inflation slowed to 0.2 percent.
"Core consumer inflation will turn negative soon, but we must watch if a worsening of the economy pushes Japan into a deflationary spiral even though the Bank of Japan sees no signs of that happening right now," said Tatsushi Shikano, senior economist at Mitsubishi UFJ Securities.
Euro zone inflation fell to a near 10-year low of 1.1 percent in December while unemployment hit 8.0 percent.
Analysts said that would raise pressure on the European Central Bank to cut interest rates as price growth is now well below its 2 percent target.
"The inflation number was definitely a shock, a much bigger than expected drop, and just shows how strong disinflationary pressures are in Europe," said Bank of America economist Matthew Sharratt said.
Worsening economic conditions could see drastic measures from central banks seeking inventive ways to support economies and help credit markets that are starving companies of cash.
Governments have spent hundreds of billions of dollars on bank bailouts and fiscal stimulus, while central banks have slashed interest rates to record lows since a U.S. housing slump burst a global credit bubble, triggering the worse financial crisis since the Great Depression in the 1930s.
President Barack Obama aims to roll out a menu of options next week to help stabilise the U.S. banking industry, with government aid tailored to individual banks' needs, a source familiar with the administration's thinking told Reuters on Thursday.
Options are likely to include a "bad bank" that could soak up mortgage securities and other distressed investments which are weighing on banks' balance sheets and holding back lending.
Stephen Green, chairman of HSBC, Europe's biggest bank and one of the few major banks which has not needed government support, said fair value accounting and capital adequacy rules had worsened the financial crisis.
"Business needs to co-operate with government and regulators in the creation of a new global marketplace for all industries and consumers," Green said.
European stocks were little changed in early afternoon trade. Japan's Nikkei share average closed down 3.1 percent.
Belgian-French financial services group Dexia forecast a 2008 net loss of 3 billion euros ($3.9 billion), dropping its dividend and announcing 900 job cuts.
Analysts warned against reading too much into a rise in British mortgage lending.
"It's clearly better than expected, but it's important to remember that we are coming off all-time lows. These numbers are consistent with further pretty sharp falls in house prices," UBS economist Amit Kara said the housing market remained tough.
Reserve Bank of Australia figures showed total credit fell 0.3 percent in December, well below a forecast 0.5 percent rise, fuelling expectations the central bank would cut cut rates next week.
(Additional reporting by Reuters bureaux; Editing by Jon Boyle and Jason Neely)