Japan adjusted its economic growth estimate for the last quarter, lowering it from 2.8% to 2.2% due to reduced consumer spending and increased private inventories. The Cabinet Office released the revised data on March 11, 2025, confirming that Japan’s real gross domestic product (GDP) maintained growth for a third consecutive quarter. Private demand declined by 0.3%, which was steeper than the initial estimate of 0.1%. Export growth was also revised downward to 1.0% from 1.1%. Policymakers face difficulties as the Bank of Japan considers an interest rate adjustment. The government confirmed that Japan’s economy expanded at an annual rate of only 0.1%. The issue of deflation, which has affected economic activity, has been partially reduced by rising wages that have helped stabilize prices.

The updated GDP figures reveal concerns about Japan’s economic direction, particularly regarding global trade policies. Disputes over tariffs and geopolitical uncertainties, especially in the United States, influence economic developments. Trade Minister Yoji Muto attended discussions in Washington on Monday to address potential tariff increases on Japanese exports, particularly steel and aluminum. The Japanese government warned that these trade restrictions might negatively impact investments, employment, and supply chains in both countries. Experts believe that stable growth will require flexible policies, strong domestic demand, and diplomatic efforts to support global trade. The latest economic report highlights the importance of balancing financial strategies with external economic shifts for long-term stability.