Global Leading Indicators

About the Leading Economic Index and the Coincident Economic Index:

The Leading Economic Index provides an early indication of significant turning points in the business cycle and where the economy is heading in the near term. The Coincident Economic Index provides an indication of the current state of the economy. Additional details are below.

The Conference Board Leading Economic Index^®(LEI) for Japan increased by 0.7 percent in May 2023 to 89.1 (2016=100), following no change in April. The LEI for Japan contracted by 2.4 percent in the six-month period ending in May 2023, following a 1.0 percent decline over the previous six months between May and November 2022.

The Conference Board Coincident Economic Index^® (CEI) for Japan remained unchanged in May 2023 at 98.7 (2016=100), after slight decline of 0.1 percent in April. The CEI for Japan fell by 0.7 percent over the six-month period from November 2022 to May 2023, after growing by 0.1 percent in the previous six-month period between May and November 2022.

“The Japan LEI improved in May, after no growth the previous month. However, the long-term growth of the index remains negative, which suggests that the Japanese economy will continue to face headwinds in the near term,” said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board. “Most components of the Japan LEI improved in May, more than offsetting declines in business failures and new orders for machinery and construction. The Conference Board forecasts real GDP growth for Japan in 2023 at 1.5 percent, but growth is likely to slow to 1.0 percent in 2024.”

The LEI for Japan improved in May

All except two components of the LEI were positive in May 

While the Japan LEI is less negative, the risks to the growth are persist

About The Conference Board Leading Economic Index^® (LEI) for Japan: The composite economic indexes are the key elements in an analytic system designed to signal peaks and troughs in the business cycle. The indexes are constructed to summarize and reveal common turning points in the economy in a clearer and more convincing manner than any individual component. The CEI is highly correlated with real GDP. The LEI is a predictive variable that anticipates (or “leads”) turning points in the business cycle by around 4 months. Shaded areas denote recession periods or economic contractions. The dates above the shaded areas show the chronology of peaks and troughs in the business cycle.

The ten components of The Conference Board Leading Economic Index® for Japan include: Operating Profits, Dwelling Units Started, Business Failures, Index of Overtime Worked, Stock Prices (TOPIX), Six Month Growth Rate of Labor Productivity, Tankan Business Conditions Survey, Money Supply, Yield Spread, and New Orders for Machinery and Construction.

To access data, please visit: https://data-central.conference-board.org/

About The Conference Board

The Conference Board is the member-driven think tank that delivers trusted insights for what’s ahead. Founded in 1916, we are a non-partisan, not-for-profit entity holding 501 (c) (3) tax-exempt status in the United States. www.tcb.org