TOKYO - Japan’s GDP, or gross domestic product, expanded at an annualized rate of 2.1% from January to March 2026, marking a second consecutive quarter of positive growth as exports and consumer spending supported the economy.
Preliminary figures released by the Cabinet Office showed real GDP, which excludes the effects of price fluctuations, rose 0.5% from the previous three-month period.
Domestic demand remained firm, with personal consumption, which accounts for more than half of GDP, increasing 0.3% for a fifth consecutive quarter of growth. Spending on dining out and clothing increased, although automobile purchases weighed on overall consumption.
Capital investment also remained positive, rising 0.3% for a second straight quarter of growth.
On the external demand side, exports increased 1.7%, also marking a second consecutive quarterly gain, supported by strong shipments of automobiles and other products to the United States.
Japan’s economy has experienced a volatile recovery over the past several years, shaped by the pandemic rebound, inflation, supply chain disruptions, weak yen pressures, and more recently energy and geopolitical risks.
After contracting sharply during the COVID-19 pandemic in 2020, Japan’s economy returned to growth in 2021 and 2022, supported by reopening demand and exports. Annual GDP growth reached around 1.9% in 2023 before slowing in 2024 as inflation weighed on household spending.
Quarterly growth has remained uneven over the past two years. Japan recorded positive growth in the second quarter of 2025 before slipping into contraction during the July-September quarter, hurt by weaker exports and slowing demand. The economy then returned to growth in the October-December quarter of 2025, with revised data showing a 0.3% quarterly increase.
The January-March quarter of 2026 marked the second consecutive quarter of expansion, with GDP rising 0.5% from the previous quarter, or an annualized 2.1%. Strong exports to the United States, particularly automobiles, helped support growth, while consumer spending and business investment also remained positive.
Despite the stronger-than-expected start to 2026, economists remain cautious about the outlook. Rising oil prices linked to instability in the Middle East and concerns over energy supplies through the Strait of Hormuz are expected to place pressure on Japan’s economy in coming months. Japan remains heavily dependent on imported energy, making it vulnerable to external shocks.
The OECD currently forecasts Japan’s overall economic growth to slow to below 1% annually over the next two years, although steady wage growth, domestic demand, and corporate investment are expected to continue supporting the economy.
Source: テレ東BIZ
