Recent Updates

  • Flash PMIs: France, Germany, Euro Area, UK, US (Jul)
  • Canada: Retail Trade (May)
  • Mexico: Service Sector, Retail & Wholesale Trade (May)
  • Bosnia: Srpska GDP By Industry (Q1)
  • Poland: Electricity Production (Jun)
  • more updates...

Economy in Brief


Japanese Corporate Prices And Machinery Orders
by Louise Curley May 17, 2010

Japan's Domestic Corporate Goods Price index has been inching up in each month since November of last year. By April the index, published today, was 0.9% above November. On a year over year basis, the index in April was only 0.2% below April, 2009.

The Domestic Corporate Goods Price Index is analogous to a Wholesale or Producer Price Index. In fact, until 2002, the index was called the Wholesale Price Index. At that time, substantial revisions were made in the index, the base was changed from 1995 to 2000 and the name was changed. The base of the index is now 2005.

The rise in prices at the wholesale level, though small, gives some reason to hope that the deflation in consumer prices will also be lessening. There is a good correlation between the Domestic Corporate Goods Price Index and the Consumer Price Index as shown in the first Chart which compares the year to year changes in the two series. The year to year change in the Consumer Price Index was -1.09% in March, the latest month available. This compares with a -2.53% year to year decline in October, 2009.

Data for machinery orders were also released today. Total orders were up 3.6% in March from February, and those for the headline series, Private machinery orders excluding volatile orders (ships and electric power) were up 5.4%. Even excluding the volatile factors, monthly orders are still erratic. As a result we have aggregated the total and the headline series to quarterly totals which are shown in the second chart. Increased activity in new orders bodes well for future sales and may have a small but positive effect on total GDP for the first quarter, which is to be published this Thursday.

Year to Year Changes (%) Apr 10 Mar 10  Feb 10  Jan 10 Dec 09 Nov 09 Oct 09 Sep  09
Domestic Corporate Goods Price Index -0.19 -1.25 -1.63 -2.20 -3.77 -5.02 -6.76 -7.88
Consumer Price Index --  -1.09 -1.10 -1.29 -1.68 -1.87 -2.53 -2.24
Quarter to Quarter Changes (%) Q1 10 Q4 09  Q3 09  Q2 09 Q1 09 Q4 08 Q3 08 Q2 08
Total Machinery Orders 9.02 8.03 8.99 -7.32 -14.47 -19.91 -10.12 -5.90
Private ex Volatile Orders (Head line) 2.92 1.13 -0.70 -5.64 -9.64 -14.69 -8.72 -2.05
large image