Japan’s capital expenditure component of GDP decelerated markedly in the first quarter of 2026, with growth easing to 0.3% quarter-on-quarter, down from 1.4% in the previous quarter. The latest figures, updated on 18 May 2026, highlight a notable loss of momentum in corporate investment compared with the robust pace seen at the end of 2025.
The prior reading for the fourth quarter of 2025 had shown capital expenditure rising 1.4% quarter-on-quarter, indicating stronger corporate spending and a more supportive backdrop for growth at that time. In contrast, the first-quarter 2026 data suggest businesses are now expanding investment at a much slower rate, potentially signaling increased caution amid evolving economic conditions.
On a quarter-on-quarter comparison basis, the “Actual” for Q1 2026 reflects the change versus Q4 2025, while the “Previous” figure for Q4 2025 captures the change from the third to the fourth quarter of 2025. The shift from 1.4% to 0.3% underscores a clear cooling in capital investment as the new year began.
