Japan's economy recorded an annualized growth rate of 1.1% in the second quarter (April–June), according to preliminary data released by the Cabinet Office on August 14. This marks the third consecutive quarter of expansion, reflecting the resilient recovery of Asia's fourth-largest economy.
Compared with the previous quarter, real gross domestic product (GDP) rose 0.3%, surpassing analysts' forecasts. The main drivers were personal consumption—which accounts for more than half of the economy—up 0.5% from the first quarter, along with exports of goods and services, which benefited from recovering global demand.
Business investment also posted a modest increase, while government spending remained steady. However, experts caution that growth remains fragile, as inflationary pressures and a weak yen could weigh on household purchasing power in the second half of the year.
The minister in charge of economic policy said the data shows the economy is on the right track, but stressed the need to closely monitor price developments and labor market conditions. The Bank of Japan (BOJ) is expected to review the figures at its upcoming policy meeting, with markets positioning for a potential interest rate adjustment.
Compared with the same period last year, nominal GDP rose about 3.2%, reflecting overall price increases. However, real growth remains below the pre-pandemic average of 2%, highlighting the long-term structural challenges facing Japan's economy.
