Japan government expects 1.2% economic growth for 2025

(FILES) This picture taken on October 30, 2024 shows a man walking past the Bank of Japan (BoJ) headquarters in Tokyo. (Photo by Yuichi YAMAZAKI / AFP)

TOKYO, Japan — The Japanese government said Wednesday that the country’s economy is expected to grow 1.2 pct in fiscal 2025, which starts next April, in price-adjusted real terms, unchanged from its previous November forecast.

The government maintained its view that personal consumption will be solid thanks to stable inflation and the effects of its economic package and that exports will recover because of a moderate pickup in overseas economies.

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The government expects personal consumption, which accounts for half of the country’s gross domestic product, to grow 1.3 pct, an increase of 0.1 percentage point from the previous estimate. It anticipates 2.0 pct inflation.

For fiscal 2024, the government lowered its economic growth outlook to 0.4 pct from 0.7 pct.

The reduction reflects slower-than-expected growth in exports amid lower vehicle production and China’s slowing growth as well as weaker personnel consumption and capital spending.