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Japan’s December consumer confidence survey - ouch!

January 17, 2007
By Ken Worsley


The Cabinet Office announced today that after reaching a six month high last month, the December consumer confidence survey fell from 48.7 to 45.9 . A figure below 50 indicates that pessimists outnumber optimists. The index measures households with two or more inhabitants (Are singles more likely to be pessimistic?)

That news hurts, though there’s also not much to be proud of in a six month high that was negative. So, what did Bloomberg’s quoted experts have to say about the situation? This gem is from David Cohen, director of Asian economic forecasting at Action Economics in Singapore:

The consumer hasn’t been carrying his weight. The corporate sector is in good shape and that’s supporting capital spending and exports. It’s just the consumer that hasn’t kicked in.

I’m not really sure what to say about that comment, other than it gives the impression of either being taken out of context or horribly ignorant of the fact that wages are not increasing. How loud can I scream it: Take home wages are not increasing!!! (I considered all caps, but standards must be maintained.)

And Hiromichi Shirakawa, chief economist at Credit Suisse in Tokyo:

Income is the key. Japanese consumers aren’t going to start spending because of job security alone.

Thanks, Hiro. At least you’re reading what I say on this site. Then again - no, you’re probably not. It’s obvious enough.

The International Herald Tribune is reporting that it seems as though the Bank of Japan will not be raising interest rates tomorrow.

There’s a link above to the Action Economics, LLC website. Check it out.

Filed Under Consumer Spending, Inflation 

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Comments

One Response to “Japan’s December consumer confidence survey - ouch!”

  1. Japan’s Cabinet Office: February consumer confidence index rises for second straight month : Japan Economy News & Blog on December 2nd, 2007 10:19 pm

    […] rise in Japan’s February Consumer Confidence Index for the second consecutive month. After a painfully low score of 45.9 in December, the index picked up to 48.1 in January, and has inched its way up to 48.4 in […]

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