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Analysis by Region - Asia Pacific - Japan

Publisher Oxford Economics
Published Dec 16, 2025
Length 9 Pages
SKU # OFE20686040

Description

We've raised our 2026 GDP growth forecast for Japan by 0.1ppt to 0.7% after assessing the initial estimate of Q3 GDP and the implications of the new government's fiscal policy. Consumption should improve gradually next year, driven by gains in real incomes. The effects of high US tariffs and the lagged impact of trade policy uncertainty on exports and machinery investment will likely ease toward H2.

Table of Contents

9 Pages
Japan: Fiscal outlook deteriorates with the new government
Forecast overview
Recent developments
Short-term outlook
Key drivers of our short-term forecast
Economic risk
Economic risk evaluation
Risk warnings
What to watch out for
Exposure to key global risks
Long-term prospects
Alternative long-run scenarios
Background
Economic development
Structure of the economy
Balance of payments and structure of trade
Policy
Economic policy

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