Japan GDP Beats Forecasts as Government Speeds Tariff Relief

Japan’s economy expanded by a seasonally adjusted 0.3% in the April-to-June quarter, or an annualised 1%, outpacing economists’ forecasts of 0.1% and marking a fifth consecutive period of growth. Resilient exports, which rose about 2% despite the newly imposed 15% U.S. tariff on Japanese goods, contributed 0.3 percentage points to the quarterly gain and offset soft domestic demand. Finance Minister Katsunobu Kato said the government will accelerate the rollout of tariff-related support measures for companies hit by higher U.S. duties. Kato added that monetary policy remains the purview of the Bank of Japan, expressing confidence the central bank will steer inflation sustainably toward its 2% goal while authorities monitor price trends and industry calls for rate increases. Economy Minister Kenji Akazawa described the latest data as evidence of a modest recovery but cautioned that U.S. trade actions could slice 0.3–0.4% off future output. The Nikkei estimates the tariffs could erase about ¥3.5 trillion ($23 billion) in corporate profits, particularly in the auto and machinery sectors. The stronger-than-expected GDP print offers embattled Prime Minister Shigeru Ishiba a brief respite as he contends with calls to resign following July’s electoral setback.