Tokyo – Japan's economy fell at an annualized rate of 1.8% in the July-September period, government data showed on Monday, as President Donald Trump's tariffs caused a surge in Japanese exports.
According to the Cabinet Office, on a quarterly basis, Japan's gross domestic product (GDP, the total value of the country's goods and services) fell by 0.4%, the first decline in six quarters.
The annual percentage rate shows what would happen to the economy if the same interest rate continued for one year. The decline was still smaller than the 0.6% decline expected by the market.
Exports suffered a major drop in the quarter, down 1.2% from the previous quarter.
Some companies had accelerated exports as much as possible to counter the tariffs, inflating some previous export statistics.
At an annualized rate, exports fell by 4.5% in the three months to September.
Imports decreased by 0.1% in the third quarter. Personal consumption increased by 0.1% in the quarter.
The tariffs are a major blow to Japan's export-dependent economy, led by powerful automakers like Toyota Motor Corp., which have long moved production overseas to avoid slowing tariffs.
The United States currently imposes a 15% tariff on almost all imports from Japan. Previously, the customs duty was 25%.
Japan also recently faced political uncertainty until Sanae Takaichi became prime minister in October.
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