Japan's Economy Surges Past Estimates in Q4 2025, PM Takaichi Pushes for More Investment

• Japan's economy grew at an annualised rate of 1.3% in Q4 2025, exceeding initial estimates due to stronger business investment.
• Prime Minister Sanae Takaichi advocates for additional spending to boost key industries amid positive growth data.
• External risks like the Middle East crisis, rising oil prices, and a weaker yen threaten the economy, potentially prompting Takaichi to increase fiscal support.
• Trade agreements with the US and Takaichi's comments on Taiwan also pose challenges, impacting domestic spending and relations with China.
• Bank of Japan is expected to hold policy on March 19, with a slight chance of an April rate hike despite economic uncertainties.