We have lowered our 2025 GDP growth forecast for Japan by 0.1ppt to 1.1%, while maintaining our 2024 growth projection at 0.2%. The downgrade to next year's growth forecast was driven by slightly worse outlooks for consumption and investment, given that we now expect the policy rate will be hiked again this year, instead of waiting until next spring.
Japan: An earlier rate hike would affect the growth outlook manageably