Japan's economy grows just 0.1% in Q4, missing expectations
Japan's economy inched up just 0.1% at the end of 2025—way below the 0.4% experts hoped for and barely bouncing back from last quarter's dip.
Q4's annualized growth was only 0.2%, far off the expected pace, putting extra pressure on Prime Minister Sanae Takaichi right after her party's big election win.
Recovery raises questions as debt hits record high
Business investment was weaker than predicted, while spending matched expectations, and exports actually dropped a bit.
With Japan's debt now more than double its GDP—even after a huge stimulus package—there are real worries about how sustainable this recovery is.
Economists expect the Bank of Japan may hike interest rates later this year to tackle inflation, but that could make things even tougher for consumers and businesses trying to get back on track.