Japan’s economy grew at an annual rate of 1.1% in the April-June quarter, according to government data released Monday. The growth was driven by exports, particularly of autos and semiconductors, despite private consumption staying flat.
Economic Challenges
The Japanese economy has been hurt by the war in Iran, which has sent energy costs surging. The country imports almost all its oil, making it vulnerable to price fluctuations. The war has also blocked the Strait of Hormuz, a vital transport route for oil exports from the Persian Gulf to Asia, pushing prices higher.
A weak yen has worked as a plus for some Japanese companies, including giant exporters like Toyota, boosting the value of overseas earnings when translated into yen. However, it makes it more expensive to import raw materials, raising prices for consumers and denting spending.
Concerns have been growing about rising prices, as wage growth in Japan has been relatively stagnant. Prime Minister Sanae Takaichi has promised to get growth going again, but her public support ratings have been gradually sinking.
Original reporting: Alexandria, VA News – WTOP News — read the source article.
