July: The Recession Indicator was 82.7%

－ Exceeding the warning level due to the stock pile-up resulting from the dismal foreign demands.

Yutaro SHIMAMURA

  Economist

2023/09/08

  The Recession Indicator for Japan in July 2023, compiled by the Japan Center for Economic Research (JCER), was 82.7% (retroactively revised basis, Figure 1). In July, Index of Producer's Inventory Ratio of Finished Goods was the main negative contributor to the leading Index. The probability then got higher by 2.5% points and reached 82.7% (over the warning level of 67%) on a retroactively revised basis. Since Consumer Confidence Index, one of the individual series of the leading index, positively affected the leading index, it seems that the dismal foreign demands played a role in piling up stocks.

【Figure 1. The Recession Indicator (July 2023)】

【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.