Business / Economy

Japan's key composite index rose in September, but Cabinet Office keeps assessment of recession

Kyodo

The government said Friday that Japan’s key composite index of economic indicators rose in September, but maintained its assessment that the economy has likely fallen into recession.

The Cabinet Office’s coincident index of business conditions increased 2.0 points from the previous month to 101.0, against the 2015 base of 100. It dropped 0.7 point in August.

The upswing was largely due to a surge in household spending ahead of the Oct. 1 consumption tax hike, an official told a press briefing.

The office left unchanged its assessment that the data suggest the economy is “worsening,” using the government’s most pessimistic expression for the second consecutive month.

The evaluation reflected weak production and exports amid the prolonged trade conflict between the United States and China, which has caused downward pressure on the global economy.

There was a surge in auto sales before the tax hike, the office said. Shipments of computers and home appliances such as refrigerators were also strong.

Looking ahead, the office said the index of leading indicators, predicting trends in the coming months, rose 0.3 point to 92.2 in September after falling 1.8 points in August.

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