Tokyo, Sept. 24 (Jiji Press)–The Japanese government kept its economic overview unchanged in its monthly report released Thursday despite lowering its views on private consumption and business investment.
The Japanese economy “is showing movements of picking up recently” although it remains in a severe situation due to the novel coronavirus, the Cabinet Office said in the September report, submitted at a meeting of economic ministers.
The government adopted the same overview for the third consecutive month.
The government lowered its assessment of private consumption for the first time since April, saying that while it is picking up, “weakness can be seen in some sectors.” Last month, there was no reference to such weakness.
The downward change came as consumption of services, mainly in the tourism and dining industries, remained low especially during August, when consumption spikes in ordinary years.
But the government continued to describe overall consumption as “picking up,” as it is rising in September to levels roughly on par with those of the past three years, a Cabinet Office official said.
The official added that it is still too early to assess the effects on consumption of the government’s Go To Travel tourism promotion program, noting that travel to and from Tokyo has yet to be included in the scheme.
The September report said that business fixed investment “is showing weakness,” worse than the August assessment that it was “in a weak tone.”
The first downward revision in four months is based on the increased availability of data pointing to a slowdown in investments.
“We knew from the supply side data that (business investment) is weak,” the official said.
Meanwhile, the government raised its assessment of exports to “picking up,” the third consecutive improvement. In August, the government said that exports showed “movements of picking up.”
Exports of automobiles and other related goods recovered, especially those bound for the United States, the official said.
According to the agency, the improvement in exports helped spur industrial production, leading the government to raise its assessment of the category for the third straight month.
The government said industrial production “shows movements of picking up” after seeing such movements only in “some sectors” last month.
The firmness of transport machinery, including automobiles, contributed most to the brighter view, the official said, also observing a pickup in other products such as chemical goods.
The government revised up its assessment of the corporate bankruptcy situation for the first time since January 2015. The September report said the number of bankruptcies is leveling off after an increase was noted last month.
The employment situation “shows steady movements in some components such as the number of employees,” the government said after referring to weakness in the situation in August.
On the outlook, the government stopped paying special attention to risks from domestic and overseas coronavirus infections, now placing them equally with the effects of fluctuations in financial and capital markets.
The government had singled out infection risks for special caution since July.
Meanwhile, it maintained the basic view that economy “is expected to show movements of picking up.”
Regarding its policy stance, the government expressed its resolve to achieve “strong economic growth” through intensive reforms, including regulatory reforms, and necessary investments including for digitization, a reference to key policy targets of Prime Minister Yoshihide Suga, who took office last week.