The Japanese GDP shrinks for the first time in six quarters
The initial value of Japan's GDP for the July to September 2025 quarter, released by the Japanese Cabinet Office on the 17th, shows that the real GDP, excluding the impact of price changes, fell by 0.4% compared to the previous quarter. If this growth rate continues for a year, it would amount to an annualized decline of 1.8%. This is the first contraction in six consecutive quarters for Japan.
According to a report by the "Nikkei Shimbun", Japanese exports fell by 1.2% compared to the previous quarter, marking the first contraction in two quarters. Due to a series of U.S. tariff policies, reduced car exports dragged down the overall performance. In addition, imports fell by 0.1%, marking the first contraction in three quarters. Items such as crude oil, natural gas, and air travel have dragged down the overall performance.
The report also pointed out that private residential investment in Japan fell by 9.4%, marking the first contraction in three quarters. Due to the tightening of residential energy efficiency standards starting in April, there was a surge in demand in March for "last-minute" purchases, resulting in a reverse decline in the July to September period. According to the GDP accounting method, residential investment is recorded based on construction progress, so the negative impact is reflected in this quarter.
Although the deterioration was less than expected, the negative economic growth may provide the basis for the Takahashi Hayato administration, which pursues a "strong economy," to implement proactive fiscal policies. It is expected that she will announce her first economic stimulus plan as early as this week. As discussions on economic measures progress, the market is closely watching the size of supplementary budget, which serves as financial support.
Original article: www.toutiao.com/article/1848999284303884/
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