California no longer has the fourth-largest economy in the world, having instead dropped to fifth on the list, according to recent reports.
The Golden State was generating goods and services at a rate of $4.215 trillion annually in the second quarter of 2025, up 5 percent in a year, but Japan’s economy spiked 6.5 percent to exceed California at $4.28 million, according to FOX 11, citing the Bureau of Economic Analysis and the International Monetary Fund.
“This scorecard reflects both geographic economic progress and fluctuations in the U.S. currency,” wrote Southern California News Group business columnist Jonathan Lansner. “Japan’s jump is due, in part, to its strong yen performance against the dollar in 2025.”
Ranked ahead of Japan and California is the U.S. at $30.6 trillion, followed by China at $19.4 trillion and Germany at $5 trillion, according to FOX 11, which reported that India ranked sixth at $4.125 trillion.
California Gov. Gavin Newsom announced in April that the state had passed Japan in the ranking, crediting population growth, tourism spending, new businesses, agriculture, technology and manufacturing. The Golden State previously became the fifth-largest economy in 2017 and held that spot for seven consecutive years, according to the governor’s office.