Economy in Brief: March 2023

Japan machine orders are lower by 10.2% in January month-to-month. They rose by 4.7% in December after ticking higher by 0.2% in November. Orders are lower by 8.1% year-over-year.

Japan core order, however, rose by 9.5% in January rising for two-months in a row. Year-over-year core orders are up by 3.5%.

Orders split between domestic/foreign show opposite results month-by-month. Over one-year domestic orders are up by 5.9% while foreign orders are lower by 16.7%.

Year-on-year growth trends show overall and foreign demand with standings below their 20th percentiles. Core orders and domestic demand each have standings of moderate-to-above median amounts, a 53.1 percentile standing for core orders and a 63.6 percentile standing for domestic demand.

Other indicators produce different results. The Economy Watchers complex of responses shows January readings barely at or below the 50 level for diffusion. The growth ranks of the Economy Watchers readings, however, all show above median expansion; most show strength. Index levels on the Economy Watchers indexes all are above the 50-percentile mark except for weakness in employment. Employment is showing sub-median readings.

The Teikoku indexes are generally weaker than the Economy Watcher diffusion indexes and they are mostly weakening month-to-month in January. The growth ranks show below-median standings for growth rates in manufacturing, wholesaling, and construction. Above median standings exist for services and retail in the Teikoku index framework. The index level of the Teikoku indexes show above 50 expansionary readings in retailing and wholesaling, a neutral 50 standing in services and below median weakness logged in construction and manufacturing.

The METI index for manufacturing is weaker in January with a growth ranking in its 16th percentile and a standing for the index level at its sixth percentile. There is clear weakness in manufacturing based on this index, the Teikoku survey and machinery orders.

The Leading Economic Index has weakened in each of the last three months. It has a 22-percentile standing for its growth rate over 12 months. The rank level of the LEI index has a 25.6 percentile standing.