• Home
• About/Contact
• Economic Reports
• Research
• Advertising

• Business
• Economics
• Reports
• Finance
• Marketing
• Politics
• Real Estate
• Services
• Retail
• Tech

Subscribe

Japan’s core consumer price index up 2.4% in July

With a 2.4% rise in July, Japan’s core consumer prices have now risen every month so far this year, and for ten consecutive months overall, according to data released today by the Ministry of Internal Affairs and Communications.

Because Japan includes energy prices as part of its core CPI, it’s also helpful to look at what the CPI looks like with energy stripped out. Here’s a breakdown of CPI categories for July:

• July general nationwide consumer price index: +2.3%
• July general nationwide consumer price index (excluding rent): +2.8%
• July nationwide core CPI (excluding fresh food): +2.4%
• July nationwide consumer price index (excluding fresh food and energy): +0.2%

Inflation in all four categories has accelerated beyond what was seen last month, and for the first time this decade we have seen the CPI rise for two months in a row when energy prices are stripped out. Of course, this is still only the third time in the past ten years we have seen a rise in this figure.

Here’s a breakdown of price increase by major category: Read more

Japan Economy News on Radio Australia

I was interviewed for a piece on Japanese agricultural policy on Radio Australia. Playlist and mp3s are available here - the interview is in the second half of the 29 August program.

Also appearing is Tobias Harris from the excellent Observing Japan.

Japan corporate service price index up 7.1% in July; Dentsu feeling the pinch

Last month, the news was that in June, Japan’s corporate price index had increased 5.6%, which was the highest rise seen since 1981. According to figures released by the Bank of Japan yesterday, July has far outstripped that figure, with wholesale prices showing a 7.1% increase, the highest seen in 27 years (which is still 1981).

According to the data, producer prices for petroleum and coal products increased 43.6% year-on-year, while while prices for iron and steel products jumped 26.7% and those for industrial chemicals were up 7.3%.

It’s also costing much more to ship goods around the country and overseas: Ocean freight prices were up 27.5% and international air freight cost 16.3% more than a year ago, while domestic air freight prices were up 6.5%. Read more

Japan supermarket sales up 0.9% in July, first rise since February

Japan’s supermarket sales rose for the first time in four months in July, post a 0.9% gain to 1.12 trillion yen, according to the Japan Chain Stores Association. These figures follow a 0.9% fall in May, and represents only the second time supermarket sales have increased in the past 31 months. However, when new shops (those opened within the past year) are included in the data, supermarkets saw a 4.4% decline in sales.

Here is a breakdown of June’s adjusted figures (not including newly opened stores): Read more

Japan’s exports up 8.1% in July; China imports more from Japan than the US for the first time since WW2

According to data released today by the Ministry of Finance, Japan’s trade surplus shrank by 87% in July, to 91.1 billion yen, as slower exports of cars, auto parts and electronics led to a 19.0% fall in Japan’s trade surplus with the United States. The overall trade surplus has now fallen for five straight months, while the surplus with the United States fell for the eleventh consecutive month.

During July, the value of imports jumped 18.2% to 7.54 trillion yen, while exports rose 8.1% to 7.63 trillion yen. Aside from the US market, exports to Asia increased 12.7%, exports to the EU area increased 4.1%, exports to Russia were up 45.8%, those to the Middle East were up 27.5% and exports to Australia increased 32.8%. Read more

Missing your market: Facebook in Japan

A classic anecdote: Jean Snow reports that a fellow blogger’s wife is unable to open a Facebook account due to her family name being Yoda.

Any word yet on whether New York Islanders right winger Miroslav Satan has a Facebook account?

Japan’s department stores out of ideas, intend to target young customers

Japan’s nationwide department store sales have declined for eleven years in a row. In June, they fell 7.6% year-on-year, and in May they slid 2.7%. February is the only month so far in 2008 to have seen a rise in department store sales, and that was by less than one percent. It seems to safe to say that 2008 is not going to be the year when department store sales turn around.

Yet, food sales have been rising month after month. In June, food sales made up 28.4% of all sales at departments stores, comprising the second largest category after clothing, which represented 34.0% of all sales in June. Sales of clothing fell 14.0% against June of 2007.

With clothing sales being pounded over recent months, department store operators in Tokyo have been pouring massive investments into their stores in order to upgrade facilities. Some of this - particularly in Tokyo’s Ikebukuro, Shinjuku and Shibuya areas - has been motivated by the opening a new subway line. Yet, the approaches taken have been inconsistent. Some department stores have declared that capital investments were being made to cater to senior citizens, others have announced upgraded areas for women’s clothing.

One might think simply, “They don’t know what to do.” Today’s Nikkei seemed to confirm that suspicion with the headline Department Stores Plan Renovations To Lure The Young.

This seems as though a move from beyond desperation. The Nikkei puts it simply:

Department store operators tend to cater to middle-aged and older consumers. Faced with sluggish sales of relatively expensive items, however, these retailers will now offer more products that younger consumers can afford.

Ouch.

Shibuya’s Tokyu Department store is spending 180 million yen for a renovation that it believes will lead to a 10% increase in sales. Generally, department stores who have announced this strategy appear to be targeting women in their 20s. Shinjuku’s Odakyu department store is spending 150 million yen - a fraction of the 8.5 billion yen it intends to spend overall by the end of fiscal 2009 - in order to create a new section of products designed to appeal to women in their 20s.

We would love to see the reports leading to the conclusion that such a move could result in a 10% increase in sales. With the way that declining department store sales are blamed on bad weather by the Japan Department Stores Association month after month, it would almost seem to make more sense to invest the money in a weather control machine at this point.

Or they could invest in new brands to open as small, niche-based shops. Nah.

Japan’s GDP drops an annualized 2.4% in the second quarter

Just three months ago, the Cabinet Office announced that Japan’s first quarter GDP has jumped a surprising 3.3% in annualized terms. No one expected a repeat of such rosy figures in the second quarter, and the 2.4% annualized contraction reported yesterday by the Cabinet Office was about what most observers had expected.

The bad news resounds: Exports fell by 2.3% in the second quarter, declining for the first time in three years. Imports fell 2.8 percent. Consumer spending was down 0.5%, while capital spending slipped 0.2 percent.

Looking through today’s headlines, it’s difficult to find good news: Cell phone sales have dropped through the floor - though this is a cause of an ill-explained change in the way mobile phones are sold in Japan, and should lead to sales increases next year. In the second quarter, sales at DoCoMo fell 21%, AU saw a 19% fall and Softbank’s sales slid 23%. As the Nikkei puts it: Read more

Japan consumer confidence hits all time lows - again - in July

In June we saw Japan’s consumer confidence fall to an all-time low. July’s figures, released yesterday by the Cabinet Office, show that a new all-time low has been reached. The general consumer confidence index figure fell from 32.6 in June to 31.4 in July, for a drop of 1.2 points. Talk of an economic stimulus package from the government has certainly not raised hopes amongst consumers, who continue to deal with higher energy and food prices.

The Consumer Confidence Index itself contains five scores, each of which is considered positive when above 50, and pessimistic when below the 50 mark. Here’s a breakdown for July’s figures, with the change from last month: Read more

FDI from Japanese nonmanufacturers up 35% in FY2007

One of themes that has often been touched on over at BizCast Japan is the increasing overseas presence of Japanese non-manufacturing firms. The Nikkei has just published an article showing the results of a joint Finance Ministry and the Bank of Japan survey showing that direct foreign investment by Japanese non-manufacturers jumped 35% in fiscal 2007 to reach about 4.3 trillion yen.

This amount is still lower than what what seen during the bubble years, when Japan’s FDI by non-manufacturing firms surpassed 6 trillion yen. Still, it is a trend that is expected to continue, given the lack of growth opportunities in the domestic market.

Retail and wholesale firms led the charge in FDI, pouring about 560 billion yen overseas in FY2007. They were followed by investment in oil and mining operations (480 billion yen) and investments in transport (330 billion yen).

Next Page »

Copyright © 2006-2008 Japan Economy News

Disclaimer