Japan’s GDP Revised to 2.3% Contraction in Q3 2025 as Tariffs Bite and BoJ Eyes Rate Hike
Deeper July–September slump raises questions about “Sanaenomics”, but markets still bet on a December rate increase. TOKYO — December 8, 2025 Japan’s economy shrank more sharply than first reported in the July–September quarter, with revised figures showing an annualised 2.3% contraction, compared with an initial estimate of 1.8%. On a quarter‑on‑quarter basis, real GDP fell 0.6%, versus the preliminary 0.4% drop and slightly worse than economists’ median forecast of a 0.5% decline. Reuters+1 The revision confirms Japan’s first GDP contraction in six quarters and the steepest fall since the third quarter of 2023, underscoring how new U.S. tariffs, weaker capital spending