01.12.202500:33:38UTC+00Japan Q3 Capital Spending Rises Less than Expected

In the third quarter of 2025, Japanese companies witnessed a 2.9% increase in capital spending, a notable deceleration from the 7.6% growth observed in the previous quarter and falling short of market predictions set at 5.9%. This recent performance represents the slowest growth rate over the past three quarters, a trend attributed to reduced manufacturing investment, diminished international demand, and the repercussions of escalating U.S. tariffs. The manufacturing sector experienced a marked downturn in investment, with growth plummeting to 1.4% from the previous 16.4% in Q2. This decline was primarily driven by downturns in the chemical products (-0.6%), production machinery (-3.0%), and information and communication equipment sectors (-43.2%). Conversely, investment in the non-manufacturing sector saw an acceleration, rising by 3.9% compared to the 3.0% increase in the preceding quarter. This growth was bolstered by substantial gains in real estate, goods rental and leasing, and information and communication services, which recorded increases of 14.2%, 13.8%, and 26.8% respectively.