The Japanese economy, in terms of demand, shows that personal consumption remains broadly flat while household income appears to be improving. Housing investment has stayed unchanged as a whole, with a decline in condominium construction offset by a rise in owner-occupied single houses. Business investment continues to rise, led by buoyant outlays by specific industries such as electric machinery. Public investment remains lower than in a year earlier. Industrial production continues to rise steadily.
Corporate profits continue to rise markedly.
Business confidence has improved as a whole, although it remains low in some sectors. On the other hand, the number of business failures has stayed somewhat high, with the gross debt of failed firms rising. Although the slack in the labour market has diminished little as exemplified by the rather high unemployment rate, improvements continue to be seen in the growing number of job offers and in rising overtime hours worked. Export volume as a whole slowed down, with exports to the United States and Western Europe faltering, while those to Asia remained resilient. Imports are rising moderately.