Japan Real Time Charts and Data

Edward Hugh is only able to update this blog from time to time, but he does run a lively Twitter account with plenty of Japan related comment. He also maintains a collection of constantly updated Japan data charts with short updates on a Storify dedicated page Is Japan Once More Back in Deflation?

Wednesday, April 30, 2008

Japan Employment and Unemployment March 2008

Seasonally adjusted unemployment dipped to 3.8 per cent in March. While that was better than the flat result of 3.9 per cent in a consensus market forecast, economists focused instead on a fall in the ratio of job offers to job seekers. That slipped to 0.95, meaning 95 jobs were available per 100 applicants.

”The trend shows hiring is slowing for the moment especially among small businesses, while big corporations continue to recruit new employees briskly,” said Yoshiki Shinke, senior economist at Dai-ichi Life Research.

Overall household spending fell 1.6 per cent in March from a year earlier in price-adjusted real terms, countering a median market forecast for a 0.5 per cent increase and further signalling weak consumer spending.

Such weakness in the domestic economy will likely keep the BOJ concerned about downside risks in coming months. Still, like other central banks, the BOJ faces rising fuel, raw materials and food prices as it ponders what to do with rates, already at a very low 0.5 per cent. Japan’s core annual inflation rate hit a decade high of 1.2 per cent in March, and as the expectation grows that the Federal Reserve’s easing cycle is coming to an end after one more 0.25 percentage point cut last Wednesday, markets are now even pricing in the possibility of a BOJ rate hike. Swap contracts on the overnight call rate are pricing in around a 60 per cent chance of a rate hike by the end of the year.

That is a sea change from just a few weeks ago when investors had been looking for a BOJ rate cut as the credit crisis weighs on global economic growth. Still the evidence and justification for expecting any such cut is rather thin.

Housing starts, hit hard by a regulatory change last year, are hardly giving cause for great optimism since they fell 15.6 per cent in March from a year earlier, below a median market forecast for a 6.7 per cent drop.

Also, the NTC Research/Nomura/JMMA Purchasing Managers Index, which gives an early snapshot of the health of manufacturing, declined to a seasonally adjusted 48.6 in April from 49.5 in March and was the lowest since 48.1 in February 2003. A reading below 50 points to a contraction in manufacturing activity.