TOKYO, Feb 6 (Reuters) - Japan's economy is expected to have returned to growth in the final three months of 2025, thanks to vigorous corporate investment and resilient consumption, a Reuters poll showed on Friday.
Gross domestic product (GDP) in real terms likely expanded an annualised 1.6% in the fourth quarter, according to the median forecast of 16 economists, after a 2.3% drop in July-September, which was the biggest decline in two years.
Without annualisation, the October-December growth rate
was estimated at 0.4%.
The estimated return to growth, after a temporary dip, "would confirm that the Japanese economy remains on a gradual recovery path," wrote Naoki Hattori, chief Japan economist at Mizuho Research & Technologies.
Private consumption, which accounts for more than half of Japan's GDP, is expected to have grown only 0.1% as persistent consumer inflation held above the Bank of Japan's (BOJ) 2% target.
Meanwhile, capital expenditure was seen growing 0.8% after the previous quarter's 0.2% contraction, supported by rosy business sentiment. A BOJ survey in December found big manufacturers' confidence hit a four-year high.
Net external demand, or exports minus imports, probably added 0.1 percentage points to the fourth-quarter GDP growth, after it shaved 0.2 points in the third quarter, when the early blow of U.S. tariffs hit exports.
Reassured by the milder-than-expected tariff impact on the Japanese economy, the BOJ in December raised interest rates to 0.75% from 0.5% and last month upgraded growth and inflation forecasts.
Japanese Prime Minister Sanae Takaichi, poised for a major win in Sunday's snap election, has vowed to boost the economy with proactive fiscal policy, which sent government bond yields to record highs last month.
The government will release the preliminary October-December GDP data on February 16 at 8:50 a.m. (2350 GMT on February 15).
(Reporting by Kantaro Komiya; Editing by Sam Holmes)
