April: The Recession Indicator marks 1.4%
－ The Leading Index rose for 11 consecutive months
The Recession Indicator for Japan released by Japan Center for Economic Research (JCER) marks 1.4% (Figure 1). The Leading Index as an underlying data rose for 11 consecutive months due to improvements in sales forecast of small businesses, inventory ratio of final demand goods, commodity price index, and others, and the recession probability remains significantly below 67%, which is a reference point of signaling a recession. However, consumer confidence in May deteriorated due to the announcement and extension of declaration of a state of emergency in response to spread of the Covid-19 infections, and economic outlook is still uncertain.
【Figure 1. The Recession Indicator (April 2021)】
【Table 1. The Recession Indicator and the Leading Index (over the last year)】
* The estimation method of the Recession Indicator has revised since the release in July 2020. Please refer to here for more details.
－ Aggravated Index of Inventory Ratio of Finished Goods influenced the probability.
－ Deterioration of the employment situation could be a factor.
－ Huge probability reduction contributed by the well-performed indices of an inventory ratio
－ Exceeding the warning level due to the stock pile-up resulting from the dismal foreign demands.
－ The probability almost stayed at the previous month's level.