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Economy in Brief

Japan's Consumer Confidence Is Up For The Fourth Month In A Row
by Robert Brusca May 18, 2009

Japan’s consumer confidence index is up for the fourth month running. It is now a monthly reading - that accounts for the history of dots on the chart which represent unconnected quarterly observations ahead of the adoption of monthly surveys. The current reading for the index is in the bottom third to quarter of its historic range, a low position, but well off from its worst in this cycle. Notably, over the last three months there have been sharp improvements in the overall livelihood assessment. Income growth, Employment, Willingness to buy durables, and Value of assets responses, all have risen over that period. Of these, income growth is still the lowest in its range standing in the bottom 11th- to 15th percentile depending on the period for that calculation. Employment and value of assets responses lie just below the boundary for the lower range quartile. Willingness to buy durable goods is, however, much stronger in its range and is closer to the midpoint at the 45th range percentile.

Clearly there has been improvement in the Japanese consumer’s assessment of the economy. Just as clearly the current readings on the consumer’s feeling about the economy are poor. For now after such a lengthy period of deterioration what is notable is the ongoing improvement in these measures and quite a notable step of improvement across the various responses. However bad off things are in Japan, they are perceived to be getting better. Importantly these assessments are not so beleaguered for spending any more.

Japan Consumer Confidence Percentile
  monthly Change over of range*
  Apr-09 Mar-09 Feb-09 3-mos 6-mos 12-Mos Since 2004 Since 1988
Overall Livelihood 33.8 31.1 29.4 4.6 4.2 0.8 28.6 26.1
Income growth 33.4 32.0 31.1 2.0 -1.1 -4.1 15.1 11.1
Employment 23.3 18.3 14.9 9.1 -1.5 -12.7 22.2 22.2
Willing to buy Durable Goods 39.0 34.2 31.4 8.4 10.2 4.8 45.9 45.3
Value of Assets 32.2 28.8 28.7 4.1 3.2 -4.1 22.4 22.4
For two-person households; * Percentiles since Mar 2004 when series became monthly or full period
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