Japan’s economy contracted at an annual pace of 2.3% in the July-September period, the government reported Monday, as exports suffered from the impact of U.S. President Donald Trump’s tariffs and public investments slipped.

The decline in Japan’s gross domestic product, or the sum value of its goods and services, translates to a 0.6% on-quarter fall, and marked a lowered revision from the preliminary data released last month, which had shown a drop of 1.8% at an annual rate, or 0.4% on-quarter, according to the Cabinet Office.

The annualized rate shows what the economy would have done if the same rate were to continue for a year.

Exports dropped 1.2% in the quarter compared to the previous quarter, unchanged from the preliminary figure, while private residential investment fell 8.2%, slightly less than the 9.4% fall seen in the earlier data.

Trump implemented higher tariffs on imports from many countries earlier this year.

In September, the U.S. lowered the tariffs surcharge on nearly all Japanese imports to 15% from an earlier plan for a 25% tariff. The tariffs on autos are a serious blow to Japan’s economy. Japan has promised to invest $550 billion in the United States, in an accommodating move announced during the tariff negotiations.

Analysts say the drop in private residential investment observed in the July-September quarter was mainly due to revisions of Japan’s building code that caused housing starts to plunge from earlier this year.

Imports slipped 0.4% during the quarter, while private consumption gained 0.2%, according to revised data.

The tariffs have strained bilateral ties between Japan and the U.S., its most important alliance partner.

Japan now has its first female prime minister, Sanae Takaichi, who remains popular, partly because of her assertive nationalist-leaning comments. She is also fostering hopes for an economic revival, although prospects remain unclear.

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Yuri Kageyama is on Threads: https://www.threads.com/@yurikageyama