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Ikea to cut prices in Japan: A furniture price war?

Two months after rival furniture retailer Nitori’s announcement that it would cut prices on 400 items by 15 to 40 percent, Ikea announced on Monday that it plans to cut prices on 1,450 items by an average of 25%.

Nitori is Japan’s largest furniture retailer, and it has reported stunning figures for its most recent quarter, with sales up 15% to 76.7 billion yen in the March-May quarter. Nitori initially predicted a 2% rise in sales for the year through February 2010, though that has been revised upward to a projected 14% increase. Read more

Is Cool Biz bad for the economy?

A Bloomberg article published today suggests that the government-led “Cool Biz” campaign might actually be bad for the economy. Under the Cool Biz guidelines, the government is recommending that firms set their air conditioners at 28 degrees Celsius during the summer. 28 degrees, of course, is hardly cool. To make up for the higher air conditioner temperatures, workers have been encouraged to go without jackets and ties during the summer months.

In truth, one does see more open necks and more short sleeves and more guys carrying their jackets on the subway, but many firms (and workers) are reluctant to change their dressing habits. Read more

DPJ to push for sale of Shinginko Tokyo?

Yesterday, Bloomberg published a piece quoting Yasunori Sone, a political science professor at Keio University in Tokyo, as saying, “The DPJ, which takes a different stance than the governor, will liquidate Shinginko Tokyo…It was clear from the beginning that its business model didn’t work.”

The second part of that statement is very true. Troubles at the publicly funded bank have been documented here before. As a quick reminder: Read more

Unemployment by region in Japan

Over at the Mutantfrog Travelogue, Curzon takes a look at unemployment by prefecture in Japan. While some of the results are unsurprising, such as Okinawa having the highest unemployment rate, other results seem to raise the eyebrows - I never would have guessed that Shimane has the lowest unemployment rate in Japan. The original map, with unemployment listings by prefecture in Japanese, can be found at Maps of Japan.

Japan’s consumer confidence rises for sixth straight month in June

After bottoming out at 26.2 in December, Japan’s Consumer Confidence Index has slowly been creeping upward over the past six months. According to data released by the Cabinet Office today, the Consumer Confidence Index reached 37.6 points in June, up from 35.7 in May. This is the highest reading seen since December 2008, and the index has now risen for six straight months.

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 June figures, with the change from the previous month: Read more

Core machinery orders at record lows, bankruptcies still soaring

Earlier today, the Cabinet Office announced that core machinery orders in Japan fell 3.0% in May, to 668.2 billion yen. Although this is less than the 5.8% drop seen in April, it still means that machinery orders have fallen to a new all-time low. May was the third month in a row that core machinery orders have fallen.

Clearly, the Japanese economy is not performing as many expect it to, as Nikkei and Dow Jones polls of economists had predicted a 2.0% rise in May core machinery orders. Capital spending still appears to have no predicatoable recovery date in sight, and the figures announced today are going to have a further negative pull on Japan’s second quarter GDP figures. Read more

Fundraising galore, corporate bond issuances at record high in June, and government enforced inefficiency at Japan Air Lines

Corporate bond issuances by Japanese firms shot to a record 1.74 trillion yen in June, according to a report in today’s Nikkei. This figure is up 150% on May 2008, reflecting the intense amount of fundraising that is currently happening in Japan.

June’s bond issuances appear to be interesting because many are coming from non-financial institutions. Sony issued 220 billion yen in debt, while Honda’s June issuance, its first in 16 years, stood at 70 billion yen. Read more

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