AI Data Insight

Latest data from DataTrack reveals that the contribution of Japan's domestic demand to real GDP growth reached 1.5% in 2025, a significant rebound from 0.6% in 2024, establishing an economic recovery trend driven by domestic demand. Benefiting from a recovery in private consumption driven by wage growth and record-breaking corporate automation investment, domestic demand performance successfully offset external trade headwinds. Looking ahead to 2026, the market is focused on whether Shunto wage hikes can remain above 3% and the Bank of Japan's (BOJ) policy path toward a further rate hike to 1.0% mid-year.

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