Global Business Cycle Indicators

Japan

Press Release Archive

Released: Thursday, January 9, 2014

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This month's release incorporates annual benchmark revisions to the composite economic indexes. These regular benchmark revisions bring the indexes up-to-date with revisions in the source data, but do not change the cyclical properties of the indexes. The indexes are updated throughout the year, but only for the previous six months. Data revisions that fall outside of the moving six-month window are incorporated when the benchmark revision is made and the entire histories of the indexes are recomputed. As a result, the revised indexes and their month-over-month changes will no longer be directly comparable to those issued prior to the benchmark revision.

For more information, please visit our website at
www.conference-board.org/data/bci.cfm or contact indicators@conference-board.org .

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The Conference Board Leading Economic Index® (LEI) for Japan increased 0.3 percent and The Conference Board Coincident Economic Index® (CEI) increased 0.2 percent in November.

  • The Conference Board LEI for Japan rose again in November, continuing a nearly yearlong streak of monthly gains. Stock prices, business failures (inverted), and the index of overtime worked made the largest positive contributions to the index this month. With November’s gain, the leading economic index has grown 3.1 percent since May 2013 (about a 6.2 percent annual rate), down from its 6.5 percent growth (about a 13.5 percent annual rate) in the previous six months. Meanwhile, the strengths among the leading indicators continued to be very widespread.
  • The Conference Board CEI for Japan, a measure of current economic activity, improved slightly in November, with employment the strongest positive contributor to the index. However, the six-month growth rate of the CEI fell to -0.1 percent (-0.2 percent annual rate), a reversal from its 0.8 percent (a 1.7 percent annual rate) growth in the previous six months. Strengths and weaknesses among the coincident indicators have remained balanced in the last six months. Meanwhile, real GDP expanded at a 1.1 percent annual rate in the third quarter of 2013, down sharply from 3.6 percent in the previous quarter.
  • While the Conference Board LEI for Japan has seen almost a year of ongoing expansion, the rate of increase has steadily decelerated in the second half of 2013. Taken together, weaker improvement in the leading index, coupled with a slightly negative turn in the coincident index, suggest that current growth in economic activity is unlikely to accelerate in the first half of 2014.

LEADING INDICATORS. Seven of the ten components that make up The Conference Board LEI for Japan increased in November. The positive contributors to the index – in order from the largest positive contributor to the smallest – were stock prices, (inverted) business failures, index of overtime worked, six month growth rate of labor productivity*, the Tankan business conditions survey, interest rate spread, and real operating profits*. The negative contributors – in order from the largest negative contributor to the smallest – were new orders for machinery and construction component*, real money supply, and dwelling units started.
    
With the increase of 0.3 percent in November, The Conference Board LEI for Japan now stands at 101.1 (2004=100). Based on revised data, this index increased 0.5 percent in October and increased 1.5 percent in September. During the six-month span through November, the index increased 3.1 percent, and all ten components advanced (diffusion index, six-month span equals 100.0 percent).

COINCIDENT INDICATORS.  Three of the four components that make up The Conference Board CEI for Japan increased in November. The positive contributors to the index – in order from the largest positive contributor to the smallest – were number of employed persons; the retail, wholesale, and manufacturing sales* component; and industrial production. Wage and salary income declined in November.

With the increase of 0.2 percent in November, The Conference Board CEI for Japan now stands at 96.6 (2004=100). Based on revised data, this index increased 0.2 percent in both October and September. During the six-month span through November, the index decreased 0.1 percent, and two of the four components advanced (diffusion index, six-month span equals 50.0 percent).

DATA AVAILABILITY AND NOTES. The data series used to compute The Conference Board Leading Economic Index® (LEI) for Japan and The Conference Board Coincident Economic Index® (CEI) for Japan reported in this release are those available “as of” 9:00 A.M. ET January 7, 2014.  Some series are estimated as noted below.

* The series in The Conference Board LEI that are based on our estimates are the six month growth rate of labor productivity, real operating profits and new orders for machinery.  The series in The Conference Board CEI that is based on our estimates is real manufacturing sales.

THESE DATA ARE FOR ANALYSIS PURPOSES ONLY. NOT FOR REDISTRIBUTION, PUBLISHING, DATABASING, OR PUBLIC POSTING WITHOUT EXPRESS WRITTEN PERMISSION.

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