It appears that Japan's economy has emerged from a "soft patch" and entered a new period of moderate growth. In April through June, the nation's gross domestic product expanded at an annual rate of 1.1 percent, the Cabinet Office announced last week. That marked the third consecutive quarter of positive growth.

Mr. Heizo Takenaka, the state minister in charge of economic and fiscal policy, said the economy "has pulled out of a stalled stage," citing "improvements" in both the corporate and household sectors. The upbeat statement, coming ahead of a general election scheduled for next month, may have been prompted in part by political calculations, but there is little question that the economy as a whole is looking up.

Taking the lead role in the recovery is big business. In the 2004 fiscal year ended March 31, large publicly traded corporations chalked up record profits, and the trend so far remains basically strong. Major companies, having completed a round of layoffs and other restructurings, are plowing back more of their profits into capital investment and job creation.