Japan's Economy Grows 2.1% Annualized in Q1 2026, Exceeds Estimates

Japan's economy expanded at an annualized rate of 2.1% in Q1 2026, outperforming analysts' expectations of 1.7% and significantly higher than the 1.3% growth in the previous quarter. On a quarterly basis, growth was 0.5%, surpassing the forecast of 0.4%. Exports saw an impressive year-on-year increase of 11.5% in March, bolstered by a 29.3% rise in semiconductor equipment shipments. The Bank of Japan revised its growth forecast for the fiscal year 2026 down to 0.5% from 1%, citing concerns over high energy prices impacting consumption and investment.