Japan’s Q3 GDP Contracts 1.8% Amid Export Weakness and Tepid Consumption
Japan's economy shrank 1.8% in Q3, underperforming economist forecasts as trade tensions and US tariffs dragged on exports. Net external demand became a subtraction from growth—a rare occurrence for the export-reliant nation.
Private consumption barely grew at 0.1%, constrained by stagnant wages and high living costs. Housing investment collapsed due to regulatory changes and tight financing, though business capital expenditure ROSE 1% on strong corporate sentiment.
With Core inflation stubbornly above the Bank of Japan's 2% target, Prime Minister Takaichi unveiled a ¥17 trillion stimulus package targeting energy subsidies and strategic industry investments. The measures aim to counterbalance weakening demand while addressing cost-of-living pressures.
