Japan's second-quarter gross domestic product (GDP) estimate was revised sharply upwards by the Cabinet Office on Monday.

Boosted by consumer spending, Japan's GDP grew at a seasonally adjusted 2.2% annual rate in the second quarter, instead of the 1% rate previously estimated in mid-August, reported the Cabinet Office.

Household consumption, or spending, rose 0.4% in the second quarter from the first, instead of the earlier estimated 0.1% rate, said officials.

The improved GDP result will be closely reviewed by the Bank of Japan, but it is yet uncertain if the central bank will lift rates at their next slated policy session, on Sept. 18-19, due to political and trade issues, said ING Think, an arm of the Dutch investment house.

"Solid Japanese GDP not enough to ensure a Bank of Japan rate hike," said ING Think. "Japan's upward GDP revision suggests wage growth and household spending will continue to drive the economy forward."

despite the better GDP report, Japan is facing some domestic political and related national budget and economic uncertainty, with the resignation on Sunday of Japan's Prime Minister Shigeru Ishiba, after recent setbacks of his ruling Liberal Democratic Party at the polls.

In addition, some exporters likely received expedited orders ahead of pending higher US import levies in the second quarter, lifting output, said ING Think.

"We believe that the front-loading of shipments resulted in stronger exports, which should lead to a more pronounced technical correction in the current quarter," added ING Think.

Tokyo and Washington last week agreed to a revised trade deal, ushering in 15% tariffs on Japanese automobile imports and other products. The rate was lower than some earlier outlooks, but the higher levies are still expected to play a role in the nation's export results in the third quarter.

Altogether, the Bank of Japan may wait until its policy-making session in October to raise its key interest rate, now at 0.5%, said ING Think.

"We are keeping our October hike call," said ING Think. "From a macro data perspective, even if we expect a temporary (GDP) contraction in the current quarter, solid growth in 1H25, firm wage growth, and above 2% inflation are likely to support the BoJ's rate action."

Japan's reported consumer price index core (CPI-core) inflation rate, which excludes fresh food costs, logged at 3.1% in July, down from 3.3% in June, but still above the Bank of Japan's (BOJ) annual 2% target, noted ING Think.