Germany's economy grew over 6 percent in nominal terms last year, raising the likelihood that it has overtaken Japan to become the third largest economy in the world.

The German government announced on Monday that the country's Gross Domestic Product expanded 6.3 percent in 2023 from the previous year to more than 4.1 trillion euros, or nearly 4.5 trillion dollars.

Japan's nominal GDP for the nine months to September was roughly 3 trillion dollars.

For Japan's economy to exceed Germany's for all of 2023 in dollar terms, its quarterly GDP for the October-to-December period needs to be about 190 trillion yen.
Japan's nominal GDP for the last quarter of 2022 was about 147 trillion yen. So it is seen as unlikely that Japan's GDP for 2023 will outstrip Germany's.

The weakness of the yen against the dollar means Japan's GDP will be lower in dollar terms due to the currency conversion. At the same time, Germany's GDP was boosted by soaring prices.

The International Monetary Fund began publishing data comparing economies in 1980. It said for the first time then that Japan's nominal GDP in dollar terms was the second largest, after America's.

China's economy overtook Japan's in 2010. The Japanese economy has been the third largest since, but is far behind the US and Chinese economies.

Now the IMF estimates that Germany's nominal GDP for last year exceeded Japan's, ranking third in the world.

Mitsubishi UFJ Research and Consulting principal economist Kobayashi Shinichiro says nominal GDP reflects prices and is close to public sentiment.

He adds that if Japan's rank slides because of the effects of prices and exchange rates, this would indicate that its economic growth is stagnating.

Japan's preliminary GDP figures for the whole of last year are slated to be announced on February 15.