Japan’s economy grows faster than estimated in 2nd quarter

TOKYO

Commuters exit a train station during a heavy rainstorm in Tokyo on Sept 6, 2026. (AFP Photo)

The Japanese economy grew faster than initially thought in the second quarter, revised data showed on Sept. 8, ahead of an expected interest rate hike in the following week.

The world’s fourth-largest economy expanded 0.4 percent in the three months to June, the Cabinet Office said, compared with the 0.3 percent shown in preliminary data.

Analysts had suggested the initial reading could complicate the Bank of Japan’s attempts to lift interest rates as it battles surging inflation and a weaker yen.

The revised data showed private consumption and corporate investment remained weak but better than preliminary data had suggested, but imports came in below the previous estimate, contributing to the upward GDP revision.

The Bank of Japan is expected to hike its key interest rate next week, while Prime Minister Sanae Takaichi reportedly plans to reshuffle her cabinet, although no major changes are expected.

The yen has come under pressure from elevated oil import costs and concerns about Takaichi’s spending plans.

But it has been boosted this month by rate hike talk, and is heading towards its highest level in 2026.

U.S. Treasury Secretary Scott Bessent’s comment to central bank governor Kazuo Ueda that he supports “Japan’s decisive market and monetary steps” has also helped support the currency.