Japan’s economic system contracts as exports are hit by US tariffs – enterprise dwell | Enterprise

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G7 progress leaderboard Japan is the primary of the G7 nations to report its economic system contracted within the final quarter.

With the US but to report GDP knowledge for Q3 2025, right here’s the leaderboard:

France: + 0.5% quarterly progress

UK: +0.1%

Canada: +0.1% (provisional estimate)

Germany: 0%

Italy: 0%

Japan: -0.4%

Share Japan's tourism shares hunch as diplomatic rift with China deepens In addition to information that its economic system shrank within the final quarter, Japan has additionally been hit by an escalating dispute with China over Taiwan.

Shares in Japanese tourism and retail firms have fallen at present, after China suggested its residents to keep away from travelling to Japan.

This transfer by Beijing escalated a diplomatic feud sparked by feedback from Tokyo’s new prime minister, Sanae Takaichi, on the potential for deploying forces within the occasion of a hypothetical Chinese language assault on Taiwan.

This triggered a wave of promoting throughout Japanese leisure shares.

Shares in Oriental Land, which operates Tokyo Disneyland, have fallen by 5.7% at present. Division retailer chain Isetan Mitsukoshi, which makes substantial gross sales to Chinese language guests, has tumbled by 11.3%.

Journey shares had been hit too, with Japan Airways falling 3.75%.

Masahiko Lavatory, a senior mounted earnings strategist at State Avenue Funding Administration in Tokyo, explains:

“The China–Japan dispute over Taiwan and Beijing’s advisory discouraging journey to Japan introduces near-term headwinds for consumer-facing sectors.

“Chinese language guests account for roughly 25% of Japan’s inbound site visitors, making department shops, luxurious retail, and hospitality significantly susceptible.”

Share Up to date at 02.42 EST

Introduction: Japan's economic system contracts as exports are hit by US tariffs Good morning, and welcome to our rolling protection of enterprise, the monetary markets and the world economic system.

Donald Trump’s commerce wars proceed to bruise the worldwide economic system, dampening demand and weakening commerce hyperlinks.

Japan is the most recent nation to indicate the results – its economic system has shrunk for the primary time in six quarters.

Japanese GDP fell by 0.4% within the July-September quarter, new official knowledge reveals, as its producers’ exports had been hit by the tariffs imposed by the US this yr.

Exports had been a key driver of the contraction; they fell by 1.2% in contrast with the April-June quarter, and had been 4.5% decrease than a yr in the past.

Again in April, Trump threatened Japan with a brand new 25% tariff on its items on the US border, which was reduce to fifteen% in July when the 2 nations reached a commerce deal.

Non-public demand additionally fell, by 0.3% quarter-on-quarter.

On an annualised foundation, Japan’s actual gross home product shrank by 1.8% on an annualized foundation within the three months via September. Though that’s higher than the two.4% fall which economists had anticipated, it may bolster new prime minister Sanae Takaichi’s case to compile an formidable stimulus programme.

Yoshimasa Maruyama, chief market economist at SMBC Nikko Securities says (by way of Bloomberg):

“Japan’s economic system was strong within the first half of this yr and at present’s GDP confirmed that momentum is halted quickly.

I count on Japan’s economic system to be again on a average restoration pattern going ahead.”

The White Home has belatedly woken as much as the impression of tariffs on Individuals (who pay the levies) too – late final week, Trump lowered the tariffs on meals imports, together with beef, tomatoes, espresso and bananas, amid rising issues about rising prices.