Japan GDP Growth Rate

Japan’s GDP was flat in Q1 of 2025, beating a flash estimate of a 0.2% contraction but marking a sharp slowdown from the 0.6% growth in Q4. Private consumption, which accounts for over half of the economy, was revised slightly higher to a 0.1% gain for the second consecutive quarter, instead of no change in the preliminary reading, reflecting government efforts to cushion the impact of rising food prices—notably rice— and higher energy cost. Business investment also strengthened, expanding 1.1%—the fastest pace since Q2 2024—though below the initial estimate of 1.4% and up from 0.6% in the prior quarter. However, government spending fell by 0.5%, contrary to the earlier estimate of no change, marking its first decline in five quarters. Meantime, net trade was a drag, subtracting 0.8 percentage points from GDP as exports declined for the first time in a year ahead of rising U.S. tariffs (-0.5% vs 1.7% in Q4) while imports jumped (3.0% vs -1.4%), the largest increase in five quarters.