Japan Defies Trump’s Tariffs with Surprising 1% Economic Growth!
Japan’s economy grows 1% despite higher US tariffs under Trump’s trade policies.
Japan's economy grew at an annualized rate of 1% in the last fiscal quarter, outperforming expectations despite the impact of higher US tariffs imposed by President Donald Trump. The latest data reveals a 0.3% quarter-on-quarter increase in real gross domestic product (GDP), marking Japan’s fifth consecutive quarter of economic expansion.
The growth was driven primarily by resilient exports, which rose 2.0% during the period. This was supported by a temporary 90-day pause on higher US tariffs, allowing Japanese companies to expedite shipments before the 15% tariff took full effect. Additionally, a surge in foreign tourist arrivals and a 1.3% rise in capital investment contributed positively, although consumer spending remained modest with only 0.2% growth. Despite steady inflation, wages have largely remained stagnant.
The stronger-than-anticipated economic performance increases the possibility that Japan’s central bank may raise its benchmark interest rate from near zero to control inflation. Meanwhile, Prime Minister Shigeru Ishiba faces mounting political pressure after his coalition failed to secure majorities in recent parliamentary elections, with the tariffs further complicating economic challenges.
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