11:53 - 17.08.2026

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August 17, Fineko/abc.az. Japan’s economy expanded at an annualized rate of 1.1% in the second quarter, missing economists' forecasts of 2%. Strong export performance was not enough to offset persistent weakness in domestic demand.

The economy had grown by 2.1% in the first quarter. Q2 marked the first full quarter reflecting corporate and household pressure from elevated energy prices stemming from the conflict involving Iran.

Following the release, the Nikkei 225 index gained 0.43%. Japan’s 10-year government bond yield held steady at 2.88%, while the yen marginally strengthened to 159.1 per US dollar.

Exports served as the primary growth engine, largely driven by the weak yen rather than higher shipment volumes. Quarter-on-quarter, GDP edged up 0.3%, falling short of the 0.5% projection. Exports contributed 0.5 percentage points to growth, while sluggish domestic demand dragged it down by 0.2 percentage points, impacted partly by national oil reserve releases.

On a year-on-year basis, Japan’s economy expanded by 0.7%, compared to 0.5% in the previous quarter.