Japan’s economy grows slower than expected in April-June
Published Mon, Aug 17, 2026 · 08:25 AM — Updated Mon, Aug 17, 2026 · 08:28 AM [TOKYO] Japan’s economy grew slower than expected in April-June, government data showed on Monday (Aug 17), as private. . .
Published Mon, Aug 17, 2026 · 08:25 AM— Updated Mon, Aug 17, 2026 · 08:28 AM[TOKYO] Japan’s economy grew slower than expected in April-June, government data showed on Monday (Aug 17), as private consumption softened due to headwinds from higher raw material costs and supply disruptions linked to the Middle East war. The annualised 1. 1 per cent increase in gross domestic product compared with a median market estimate of 2 per cent growth in a Reuters poll. It also followed an upwardly revised 1. 9 per cent expansion in the previous quarter, extending the economy’s growth streak to three consecutive quarters. The reading translates into a quarterly rise of 0. 3 per cent, compared with the median estimate of a 0. 5 per cent increase. Private consumption, which accounts for more than half of economic output, was flat, falling short of a market estimate of a 0. 5 per cent increase. Consumption and wage trends are key factors the BOJ is watching to gauge economic strength and determine the need for additional rate hikes. Capital spending, a key driver of private demand, fell 1. 2 per cent in the second quarter, versus a market forecast for a 0. 4 per cent increase. Net external demand, or exports minus imports, added 0. 5 percentage point to growth. Exports remained resilient thanks to solid US demand for Japanese hybrid vehicles and sustained global investment in artificial intelligence that supported shipments of semiconductor-related equipment and components. SEE ALSOMoreLooking ahead, analysts cautioned that rising import costs and mounting upstream price pressures could eventually feed through to consumers, posing a risk to spending later this year. Private consumption could also see a pullback in the July-September quarter, after policy and regulatory changes temporarily boosted demand for durable goods such as automobiles and air conditioners in April-June. A survey this month by the Japan Centre for Economic Research showed 37 economists forecast annualised GDP growth to slow to an average 0. 05 per cent in the July-September quarter. REUTERS