The Japanese government on Thursday retained its view that the economy is recovering moderately, with growing confidence in labour market conditions due to rising wages and their expected positive impact on domestic demand.

In its monthly economic report, the government raised its assessment of employment conditions for the first time in 11 months, saying there has been “improvement recently.” It also changed its assessment of wholesale prices from “flat” to “falling moderately.”

The Cabinet Office maintained its view on major components of the economy such as private consumption, business investment, and exports. Consumer prices, which track wholesale prices with a lag, are still “rising,” the report said.

It retained its basic assessment of the economy overall as “recovering at a moderate pace” a month after the government upgraded it for the first time in 10 months in May.

The June report described both business investment and private consumption as “picking up,” while saying exports are “steady.”

Japan’s economy grew for the second straight quarter in January-March, led by strong corporate spending and resilient private consumption, separate data released earlier in the month showed.

For the current quarter to June, economists expect modest growth to continue despite uncertainty over the global economic outlook after aggressive interest rate hikes by major central banks.

The global economy is “picking up despite weakness in some regions,” the Cabinet Office said, using the same expression for the second straight month.

https://mainichi.jp/english/articles/20230622/p2g/00m/0bu/050000c

Category: Japan