Japan’s economy expanded 0.3% qoq in Q2, topping expectations of 0.1% qoq. Q1 figures were also revised up to 0.1% qoq growth from a prior estimate of contraction. On an annualized basis, GDP rose 1.0% , marking a fifth consecutive quarter of expansion—a sign of steady, if moderate, momentum.
Capital investment increased 1.3% qoq, extending its growth streak to five quarters, reflecting resilient corporate spending. Exports also provided a boost with a 2.0% rise, outpacing the 0.6% gain in imports, which act as a drag on GDP. The combination of solid external demand and firm investment highlights a balanced growth profile.
Private consumption, which accounts for more than half of Japan’s economic activity, inched up 0.2% qoq. The soft household spending highlights the need for wage growth and consumer confidence to strengthen if Japan is to build on its investment-led momentum and secure a more balanced recovery.
