Japan’s Q1 GDP growth of 2.1% beats forecasts, but geopolitical tensions threaten economic momentum, the economy minister warns.
Japan’s economy minister highlighted strong wage growth and improving labor conditions as drivers of a moderate economic recovery. The remarks followed Q1 GDP data showing a 2.1% annualized expansion, exceeding market expectations and signaling resilience in domestic demand.
The minister cautioned that escalating Middle East conflict poses risks to energy prices and broader economic activity. Policymakers pledged nimble responses to mitigate fallout, including monitoring household spending and business sentiment amid rising costs.
USD/JPY hovered near 159, reflecting market sensitivity to both domestic growth signals and external geopolitical risks. Analysts noted the dual focus on wage-driven recovery and conflict-related uncertainties.