Japan’s economy loses some steam in the second quarter

In Japan on 17 August 2026, figures showed the economy grew for a third straight quarter in April to June, but more weakly than forecast. Nikkei Asia reported growth of 1.1%, and Reuters said the miss came from weaker spending and investment. Bloomberg linked the slower growth to the Middle East conflict clouding the outlook, and Al Jazeera said weak spending slowed the economy despite export support.

The Wall Street Journal said weak spending could vex the Bank of Japan, while Daily Sabah said the miss is unlikely to alter the prospect of a rate hike. The 10-year Japanese government bond yield slipped past 2.9% on expectations of faster tightening by the Bank of Japan, and the Financial Times reported it reached a three-decade high.