January: The Recession Indicator marks 2.7%
－ The leading index rose for the first time in two months
The Recession Indicator for Japan released by Japan Center for Economic Research (JCER) marks 2.7% (Figure 1). The Leading Index as an underlying data rose for the first time in two months, due to improvements in inventory ratios of final demand goods and of producer goods for mining and manufacturing, commodity price index, and others. Accordingly, the recession probability remains low level, significantly below 67%, which is a signal of recession. Although consumer sentiment deteriorated following the declaration of the state of emergency, indicators in manufacturing industry maintaining relatively steady and financial markets pushed up the Leading Index due to expectations for the normalization of economic activities by spreading vaccines.
【Figure 1. The Recession Indicator (January 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.
January: The Recession Indicator marks 94.0%
－ The Leading Index is at its lowest level in about two years
December: The Recession Indicator reached 92.3%
－ The highest level since November 2019
November: The Recession Indicator rose to 80.8%
－ "Early warning signal" alarmed again
October: The Recession Indicator fell to 35.3%
－ The Indicator was below the reference point of signaling recession
September: The Recession Indicator rose to 75.8%
－ Deterioration of production pushed down the Leading Index