MNI BRIEF: Japan Q4 GDP To Posts 1st Rise in Two Quarters

Japan’s economy is expected to have expanded in the October-December quarter for the first time in two quarters, supported by strong capital spending and public investment, according to forecasts from eight private-sector economists.

Economists expect preliminary fourth-quarter GDP to rise 0.5% q/q, or an annualised 2.0%, reversing a 0.6% q/q contraction, or an annualised -2.3%, in the third quarter of 2025.

Private consumption, which accounts for about 60% of GDP, is seen rising 0.2% q/q, matching the increase recorded in the July-September quarter.

Capital investment in the fourth quarter is expected to have increased 0.8% q/q, rebounding from a 0.2% decline in the previous quarter.

The Cabinet Office will release preliminary GDP data for the October–December quarter at 0850 JST on Monday, Feb. 16 (2350 GMT on Sunday, Feb. 15).

Net exports of goods and services are expected to have made a positive 0.1 percentage point contribution to overall growth, after subtracting 0.2 percentage point in the third quarter.

Public investment is forecast to have risen 0.2% q/q, following a 1.1% decline in the previous quarter.

Looking ahead, economists expect Japan’s economy to continue growing in the January-March quarter of 2026, supported by steady capital spending and private consumption.

However, they cautioned that trade frictions between Japan and China could weigh on exports and production.