June: The Recession Indicator was 44.5%

－ The probability almost stayed at the previous month's level.

Yutaro SHIMAMURA

  Economist

2023/08/08

  The Recession Indicator for Japan in June 2023, compiled by the Japan Center for Economic Research (JCER), was 44.5% (retroactively revised basis, Figure 1). Based on the Leading Index, this probability indicates the likelihood of entering a recession in the months ahead. Stock Prices (TOPIX) of June improved two months in a row. In addition, both Index of Producer's Inventory Ratio of Finished Goods (Producer Goods for Mining and Manufacturing) and Nikkei Commodity Price Index (42 Items) positively contributed to the Leading Index. Hence, the probability has been below the recession warning level of 67% on a retroactively revised basis for three consecutive months since April 2023.

【Figure 1. The Recession Indicator (June 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.