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Index Shows Continued Japan Expansion

July 07, 1999|Associated Press

The Japanese economy is in store for more growth over the next few months, according to an economic barometer. Japan's index of leading indicators, which is intended to forecast economic conditions in the next few months, rose to 64.3 in May from 55.6 in April, the Economic Planning Agency said. Figures above 50% indicate economic expansion, while levels below that mean a contraction. It was the third month in a row that the figure topped this boom-or-bust threshold. At the same time, the index of coincident economic indicators, a measure of the current health of the economy, stood at 37.5%, and below 50% for the second successive month. The indexes compare the level of various economic indicators, such as production, inventory and jobs numbers, with their level three months earlier. While struggling through a stubborn recession, Japan has recently been awash in a surprising wave of good economic news. A planning agency official pointed out positive elements such as the three-month rise in the leading indicators index and data suggesting a recovery in consumption, but he said production is still sluggish and the unemployment situation remains severe.

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