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Japan’s economy slows, missing growth forecasts

Japan's Economy Slows, Missing Growth Forecasts: A Deeper Dive into the Consequences Jean's economy has been dealt a significant blow as the latest data reveals a sluggish growth rate of 0.3 percent in the second quarter, falling short of initial forecasts. The underwhelming performance can be attributed to a decline in consumption and capital spending, posing significant concerns for the country's economic trajectory. As the world's third-largest economy, Japan's slowdown is likely to have far-reaching implications for the global market. Key Highlights: Sluggish GDP growth: Japan's GDP rose by a mere 0.3 percent in the second quarter, missing initial forecasts and sparking concerns about the country's economic momentum. Decline in consumption: Weakened consumer spending, which accounts for roughly 60 percent of Japan's economy, has been a major contributor to the slowdown. Capital spending sag: A decline in capital expenditure has also hin...

Adidas warns that tariffs could hurt US consumers and may raise prices.

Adidas (ADSGn.DE), a sportswear company, opened a new tab on Wednesday and warned that it might have to raise prices in the US after revealing that US tariffs would increase costs by about $200 million ($231 million) in the second half.

Adidas' stock fell 11% on the worst day since U.S. President Donald Trump announced higher tariffs in April, increasing the stock's losses since the year's beginning to 26%.
Adidas claimed that trade uncertainty was preventing it from raising its yearly guidance and that it had not yet made a decision regarding potential price hikes in the US to lessen the impact.

CEO Bjorn Gulden stressed during a call with analysts that the ultimate tariff levels were still unknown, but he expressed concern about how higher prices would affect U.S. consumer demand.
"To be honest, I'm more concerned about how consumers will react to the price increases that I believe will occur not only in our industry but also in the United States as a whole than I am about the cost," Gulden said.
"Things will happen on the demand side, and volumes will obviously decline if we have massive inflation in the United States."

Gulden declined to speculate on the potential price increase, saying Adidas will review its pricing and determine which products it could raise prices on in the U.S. once tariffs are finalized.
As long as possible, he stated, "We will try to keep the prices on known models stable and then do new pricing on products that haven't existed before."
 
According to data compiled by LSEG, Adidas' second-quarter sales climbed 2.2% in euros to 5.95 billion ($6.9 billion), which was less than the average estimate of 6.2 billion euros made by analysts.
The shortfall will probably exacerbate worries that Adidas is losing ground following a period of exceptionally robust sales growth driven by its stylish three-striped, multicolored Samba and Gazelle shoes.

In a note to clients, UBS analyst Robert Krankowski stated, "The company will need to deliver a reassuring message regarding the outlook for H2 and the early 2026 order book if investors are to view this as a temporary setback."


SOURCE : NEWS AGENCIES

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