The Japanese economy, in terms of demand, shows that personal consumption remains broadly flat, despite the decrease in income is coming to an end. The level of housing investment is stable as a whole with bullish condominium construction. Investment in plant and equipment continues its upward trend. The level of public works is lower than the level seen a year ago. Industrial production continues to rise steadily.
Corporate profits continue to improve markedly.
Corporate confidence has further improved as a whole, although it remains at a low level in some sectors. On the other hand, the number of business failures has been somewhat high, with gross debt of failed firms rising. Although the employment situation remains severe with the unemployment ratio staying at a high level, there are improvements such as continued increase in overtime hours worked and in job offers. Exports, especially those to Asia, have been rising modestly, despite a slowdown in exports to the United States and Europe. Imports, especially those from Asia, are increasing.