AI Data Insight
In the first quarter of 2026, the year-on-year contribution of Japan's gross fixed capital formation to real GDP dropped to 0.0 percentage points, a significant slowdown from the 0.2 percentage points in the previous quarter. Affected by geopolitical turbulence in the Middle East and cooling AI infrastructure investment, the contraction in corporate capital expenditure became the key reason Q1 economic performance fell short of initial expectations, although the recovery in private consumption and exports still provided strong support for the overall economy.