Global Leading Indicators

The Conference Board Leading Economic Index^®(LEI) for Japan decreased by 0.9 percent in January 2023 to 87.8 (2016=100), following a 1.7 percent decline in December 2022. The LEI for Japan contracted by 4.9 percent in the six-month period ending in January 2023, following a 1.5 percent decline over the previous six months between January 2022 and July 2022.

The Conference Board Coincident Economic Index^® (CEI) for Japan decreased by 0.3 percent in January 2023 to 99.0 (2016=100), following a 0.1 percent decrease in December 2022. The CEI for Japan fell by 1.1 percent over the six-month period from July 2022 to January 2023, after contracting by 0.2 percent in the previous six-month period between January 2022 and July 2022.

“The LEI for Japan declined for the fifth consecutive month in January and was revised down from September 2022 through December 2022,” said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board. “Widespread weakness among the non-financial components of the LEI were the main driver of January’s decline. While household spending improved substantially in the first month of this year, high inflation will probably continue to dampen consumers’ purchasing power. The Conference Board forecasts year-over-year real GDP growth for Japan at 1.7 percent in 2023 before it decelerates significantly to 0.5 percent in 2024.”

The LEI and CEI for Japan continued to fall in January

Recent decline in the LEI was driven mainly by non-financial components

Japan LEI annual growth rate fell deeper into negative territory

About The Conference Board Leading Economic Index^® (LEI) for Japan: The composite economic indexes are the key elements in an analytic system designed to signal peaks and troughs in the business cycle. The indexes are constructed to summarize and reveal common turning points in the economy in a clearer and more convincing manner than any individual component. The CEI is highly correlated with real GDP. The LEI is a predictive variable that anticipates (or “leads”) turning points in the business cycle by around 4 months. Shaded areas denote recession periods or economic contractions. The dates above the shaded areas show the chronology of peaks and troughs in the business cycle.

The ten components of The Conference Board Leading Economic Index® for Japan include: Operating Profits, Dwelling Units Started, Business Failures, Index of Overtime Worked, Stock Prices (TOPIX), Six Month Growth Rate of Labor Productivity, Tankan Business Conditions Survey, Money Supply, Yield Spread, and New Orders for Machinery and Construction.

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About The Conference Board

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