MNI: Japan Govt Keeps Economic Assessment, Ups Imports

MNI (TOKYO) - Japan’s government left its overall economic assessment in November for the fourth straight month but upgraded its view on imports for the first time since May 2024, the Cabinet Office said on Tuesday. 

The assessments on other major components, such as exports, private consumption, capital investment and production were left from the previous month.

But the government tweaked its assessment on consumer prices for the first time since January 2024 and on corporate goods price index for the first time since September. 

Consumer prices have been rising “recently” boosted by the yen's fall around June and July, the government noted, in contrast to it previous statement that they had been rising moderately. It also said that CGPI is rising moderately on the back of rice and nonferrous metals price increases. The previous view was that the pace of CGPI rising was slowing.

The government said that the Japanese economy is recovering at a moderate pace, although it recently appears to be pausing in part. “Imports are recovering recently,” the government said, which differed from its previous view that "imports were largely flat.”

As for the near-term outlook, the government maintained its optimistic view, saying that the economy is expected to continue recovering at a moderate pace with the improving employment and income situation, supported by policy effects.

However, the government maintained its cautious view, saying that slowing of overseas economies presented a downside risk to the Japanese economy, including the effects of continued high interest rate levels in the U.S. and Europe, pointing to “the lingering stagnation of the real-estate market in China.”

“Full attention should be given to price increases, the situation in the Middle East and fluctuations in the financial and capital markets,” the government added.

It left its assessment on overseas economies for the fifth straight month, noting that they are recovering despite stagnation in some regions. However, it warned attention should be paid to U.S. economic policy, the Middle East situation, and their impact on financial and capital markets.

An official at the Cabinet Office told reporters that the government will pay attention to the impact of the U.S.'s incoming trade policies that could see 10-20% tariffs on Japan and 60% tariffs on China.