Japan’s GDP expanded by 0.3% quarter-on-quarter in Q4 2025, up from the flash estimate of 0.1% and in line with market expectations. The outcome followed a 0.7% contraction in Q3 and reflected upward revisions to private consumption, business investment, and government spending.
Private consumption—which makes up more than half of Japan’s economy—was revised to a 0.3% increase (vs 0.1% in the earlier estimate and 0.5% growth in Q3), supported in part by Tokyo’s fiscal measures to ease cost-of-living pressures. Business investment was revised sharply higher to 1.2% (vs 0.2% previously and flat growth in Q3), indicating stronger corporate spending on capacity and equipment. Government spending rose 0.4% (vs 0.1% in the flash reading and 0.1% in Q3), underscoring continued fiscal support.
Net trade made no contribution to overall growth, as both exports (-0.3% vs -1.4%) and imports (-0.3% vs -0.1%) declined, reflecting softer external demand and weaker domestic import needs.
