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Tuesday, Jan. 23, 2007
Economic outlook still rosy: Cabinet
Despite weak indicators for private consumption, the economy continues to recover thanks to brisk business activity and capital investment, the Cabinet Office said Monday in its monthly economic report for January.
The report, which describes the state of the economy as of January, confirmed the economy has grown for 60 months straight. The current expansion has already surpassed the previous postwar record of 57 months set in July 1970.
"Private consumption remains flat because consumer confidence remains unchanged and the growth of household income is slower," the report says.
However, it also says private consumption is expected to increase as stronger employment rates push up income.
A Cabinet Office official who briefed reporters said supermarket and department store sales were slow in November due to unusually warm winter weather. December sales were also weak, the official said, adding that sales of high-priced items, including winter coats, were down.
Hiroko Ota, minister in charge of economic and fiscal policy, submitted the report to a meeting of ministers, senior members of the ruling parties and the Bank of Japan.
Regional recovery Kyodo News The Finance Ministry said Monday that all 11 of its regional bureaus reported a recovery trend in their local economies in the October-December period for the fifth straight quarter.
That stretch is the longest economic recovery reported by all the bureaus since the 11 successive quarterly expansions from 1987 to 1991, when Japan was in the midst of the asset-inflated bubble economy.
The ministry, whose overall assessment of the economy for the final quarter of 2006 was unchanged from the July-September period, said the economy was continuing to post a moderate recovery despite some regional disparities.
The assessment has remained unchanged for 12 consecutive quarters, a ministry official said.
The latest quarterly report anticipates solid growth in the coming months, while noting that the impact of crude oil prices requires careful monitoring.
The ministry's view of all 11 regional economies remained unchanged from the previous report released in October.
The economy in the Tokai region -- the home of Toyota Motor Corp. -- was "on an expansion trend," backed by growing production and solid private consumption, the report says.