Economic Trends Research, July 2018
Economic diffusion index (DI) worsened for two months in a row, domestic economy is weak
— An increase in the cost burden resulting from the high price of crude oil and manpower shortage —
Overview of August 2018: Weak domestic economy
The economic diffusion index (DI) in July 2018 was 49.5, up 0.5 points from the previous month, and improved for the first time in four months. A heat wave and bonuses stimulated consumption and the domestic economy improved for first time in four months, but it was at a standstill as torrential rain triggered stagnant corporate activities mainly around disaster-stricken areas.
Future outlook: Uncertainty has intensified
A steady increase in exports and capital investment will underpin the domestic economy, and reconstruction demand after disasters is expected to emerge; however, there are concerns about overseas risks such as trade friction, and the impact of high crude oil prices.
Primary points of survey results(summary)
- 1 By industry : A heat wave and bonuses stimulated consumption, and disasters caused by heavy rain had an adverse effect.
- 2 By size :All of “large enterprises,” “SMEs” and “small enterprises” improved for the first time in four months.
- 3 By region : While nine of the ten regions improved, the Chugoku region worsened partly due to heavy rains.
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