Economists predict that Japan’s GDP growth will accelerate to 1.3% in 2025

Ten private economists predicted the outlook for Japan’s domestic GDP, predicting that Japan’s personal consumption will rebound in 2025 and equipment investment will also grow. But overseas situations also need attention. Some people point out that “the US tariff burden and retaliation may drag down Japan’s economy by 0.1-0.2%.”

Asking 10 private economists for forecasts for Japan’s gross domestic product (GDP), the results show that the average forecast for 2025 will actually increase by 1.3% over the previous year after excluding the impact of price changes. Personal consumption will rebound and equipment investment will also grow. However, if domestic prices in Japan continue to rise or the overseas economy slows down further, it may have a negative impact on Japan’s economy.

Japan’s personal consumption is expected to grow by 1.0%, turning from negative growth of 0.1% in 2024 to positive growth. Takayuki Miyajima of Sony Financial Group believes that “the recovery of personal consumption will be the main driving force for economic recovery.” As the main reason for the deterioration of the economy, he cited rising food prices, which may lead to a stronger intention of consumers to save.

Equipment investment is expected to grow by 1.7%, an increase from 1.2% in 2024. Kyohei Morita of Nomura Securities predicts that “investment in labor-saving and digitalization will increase due to the structural factor of labor shortage.”

Exports are expected to grow by 3.7%, significantly exceeding the 1.0% growth in 2024. Ryomaru Kumagai of Daiwa Institute of Research said, “With the strong investment intention of companies, equipment investment remains strong, and the continued recovery of the silicon cycle (the semiconductor market repeats boom and bust every few years) and the increase in consumption by foreigners visiting Japan are expected to support exports.”

Overseas situations also need attention. The full picture of US President Trump’s economic policies such as raising tariffs is not yet understood. Yoshimasa Maruyama of SMBC Nikko Securities estimated that “the US tariff burden and retaliation may drag down the Japanese economy by 0.1-0.2%.”

Atsushi Takeda of Itochu Research Institute pointed out that “the Chinese economy will be hit by Trump’s policies, and there is a risk that the government will not be able to recover even if it launches a large-scale economic stimulus.”