Japan's economy expanded at an annualized rate of 1.9% in the April-June quarter, according to the Cabinet Office's second preliminary reading released September 8, 2026. Real GDP rose 0.5% quarter-on-quarter. The gain came mostly from trade, not from companies opening their wallets at home.
The component breakdown splits a resilient household sector from a hesitant corporate one. Private consumption rose 0.4% and residential investment climbed 0.9%, while private non-residential investment, the line that covers new factory equipment and machinery, fell 1%. Private inventories subtracted 0.1 percentage point from growth, consistent with firms running down stock rather than building it. Net exports contributed 0.3 percentage point, with exports up 1.7% against a 0.3% rise in imports. Public demand added a smaller lift: government consumption rose 0.4% and public investment rose 1.4%, each contributing 0.1 percentage point.
| Category | Change |
|---|---|
| Private consumption | +0.4% |
| Residential investment | +0.9% |
| Business (non-residential) investment | -1.0% |
| Government consumption | +0.4% |
| Public investment | +1.4% |
| Net exports (contribution) | +0.3 pt |
| Private inventories (contribution) | -0.1 pt |
On the price side, nominal GDP, the yen-value measure that reflects both volume and price changes, rose 1.3% quarter-on-quarter, an annualized 5.5%, up from the 1.2% reading (annualized 4.8%) in the first preliminary estimate published August 17, 2026. The gap between that nominal figure and the 1.9% real annualized rate points to price pressure still running through the economy even as physical output growth stays modest.
The report leaves business investment as the soft spot in an otherwise export-led expansion. Whether the 1% capex decline is a one-quarter wobble or the start of a run will only become clear in the Economic and Social Research Institute's next release, drawn from the same GDP expenditure-approach framework the Cabinet Office publishes each quarter.