Japan Economy Watchers Survey

Eco Watchers Survey shows a moderate rebound in April.

Published monthly by the Cabinet Office. Updated till the month of April 2017 (published on May 11th, 2017)

Recent data trend:

In April 2017, both current and future DIs showed modest rebounds, after deteriorating in the first 3 months of 2017. The current economic DI recently peaked in December 2016 at 51.4 and had deteriorated to 47.4 in March before rebounding to 48.1 in April. The major three sub-components of the DI, household, corporate and labor market, exhibits the same trend as the overall DI.

The rebound in April is a relief for the Japanese economy watchers. The conditions for the Japanese economy seem relatively positive and stable, except for the geopolitical risk related to North Korea. A mild depreciation in yen in April and the subsequent rise in stock prices also suggest that the rebound may continue into May.

We would point out that the medium to longer term factors remain adverse to the Japanese economy though. The monetary policy has become a source of negative risk as the BoJ explores an exit from its aggressive easing in the last 4 years. While Japan seems to be temporarily blessed with an upturn in the global economy and the stable domestic economic environment in 2017, we continue to sense a fragility in the economy. 

Brief overview of “Economy watchers survey":

"Economy watchers survey" is a survey of people who are working in industries that are sensitive to economic trends, such as household activity, corporate activity, and employment. This index is a diffusion index (DI). The index over 50 indicates that the economy is expanding, while the index below 50 indicates that the economy is contracting. 

DI for current conditions indicate the direction of change compared to 3 months ago, and DI for future condition index indicates the expected direction of change within the next 2 or 3 months.

For more information, visit the official government page


Source: Cabinet Office, JMA

The Next Release Date:  June 8th, 2017

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