Japan Q1 Capital Spending Surges Past Expectations

2025-06-02 00:18 By Jam Kaimo Samonte 1 min. read

Capital expenditure by Japanese companies rose sharply in the first quarter of 2025 ahead of the imposition of US tariffs, climbing 6.4% year-on-year.

This marks a strong rebound from the 0.2% decline recorded in the previous quarter and significantly surpasses market expectations for a 3.8% increase.

The growth was broad-based, with both manufacturing and non-manufacturing sectors contributing to the upswing.

Capital spending in the manufacturing sector rose by 4.2%, while the non-manufacturing sector posted a stronger gain of 7.6%.

Among individual industries, the largest increases were seen in petroleum and coal products (+33.3%), information and communications (+25.2%), iron and steel (+21.8%), transport and postal services (+19.3%), and food (+13.1%).

The robust capital investment signals renewed corporate confidence and may support Japan’s broader economic recovery momentum.



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