Pedestrians walk past an electronic board displaying various companies' share prices, at a business district in Tokyo, Japan, October 31, 2023. REUTERS/Kim Kyung-Hoon

By Makiko Yamazaki

TOKYO, Dec 1 (Reuters) - Japanese corporate spending on factories and equipment rose 2.9% in July-September versus the same period a year prior, Ministry of Finance data showed on Monday, signalling the world's fourth-largest economy was weathering the impact of U.S. tariffs.

The data, which will be used to calculate revised third-quarter gross domestic product figures due on December 8, is likely to support the case for an interest in the central bank's policy interest rate.

Preliminary data last month showed the economy shrank an annualised 1.8% in July-September, as a drop in exports in the face of U.S. tariffs resulted in the first contraction in six quarters.

Capital spending in July-September compared with a 7.6% gain in the previous three-month period. It fell 1.4% on a seasonally adjusted quarterly basis.

The data also showed corporate sales rose 0.5% on year and recurring profit increased 19.7%.

Capital expenditure has been mostly robust in recent years due to strong appetite for investment in information technology to offset a chronic labour crunch in the fast-aging population.

The strength in capital expenditure, a key gauge of domestic demand-led economic growth, is likely to underpin the economy when persistent inflation pressures private consumption and exports continue to battle U.S. tariffs, analysts said.

The government is also focused on stimulating investment through targeted public spending in sectors key to economic security. Last month it finalised a stimulus package of 21.3 trillion yen ($136 billion), the largest since the COVID-19 pandemic.

($1 = 155.8500 yen)

(Reporting by Makiko Yamazaki; Editing by Christopher Cushing)