Scorching summer heat has enveloped Japan, with temperatures reaching 35 degrees Celsius and higher, prompting discussions about the economic effects of extreme heat. Some experts believe that rising temperatures can stimulate consumer spending during the summer months as people are encouraged to go outdoors and spend on products like watermelons, ice cream, and beverages.

Despite the initial boost in consumption due to good weather and the appeal of heat-related products, the relationship between extreme heat and consumer spending is more nuanced. Chief economist Takuya Hoshino observed that while consumer expenditure typically increased with temperatures between 30 and 34.9 degrees Celsius, on extremely hot days above 35 degrees Celsius, spending actually decreased. This shift in consumption behavior could be attributed to heightened concerns about heatstroke, leading individuals to limit unnecessary outings, ultimately affecting overall spending trends.

In addition to potential dampened consumer spending, extreme heat can also have adverse effects on household finances and the agricultural sector. Increased air conditioner usage to combat the heat can lead to higher electricity bills, adding financial strain to households. Furthermore, the growth of vegetables, particularly leafy greens like cabbage and lettuce, can be hindered by excessive heat, potentially driving up vegetable prices and impacting consumer spending habits as people are more sensitive to changes in prices of everyday items. Senior executive economist Yoshiki Shinke warns that severe heat can pose unexpected challenges to the economy, underscoring the need for caution and preparedness to mitigate its potential negative impacts.