emirates7 - Capital expenditure by Japanese firms rose 6.4 percent in the first quarter through March compared to the previous year, marking the first increase in two quarters. This growth reflects strong investments aimed at boosting production capacity and accelerating digitalisation, the Finance Ministry reported Monday.

According to Kyodo News, total investment by all non-financial sectors—including factory construction and equipment upgrades—reached 18.80 trillion yen (about $131 billion), the highest level recorded since comparable data tracking began in 2001.

Among manufacturers, spending increased by 4.2 percent, driven mainly by food and steel producers expanding their output. Non-manufacturers saw an even larger rise of 7.6 percent, led by the information and communications sector’s efforts to develop digital infrastructure.

Pretax profits climbed 3.8 percent to 28.47 trillion yen in Q1 2025, marking the second consecutive quarterly rise, with gains largely supported by the construction and real estate industries.

Sales also hit a record high of 404.23 trillion yen, up 4.3 percent and marking the 16th straight quarter of growth. This was fueled by transport equipment manufacturers—including automakers—and wholesalers and retailers like trading houses.