A Framework That Provides Clarity

During periods of “low visibility,” confusion reigns: for every indication of one trend, there seems to be a countertrend. The key is to glean from the collective wisdom of reliable leading indicators a clear signal that the economy is headed for a turn.



Japanese Recession to Worsen

Things appear to be getting worse for the already beleaguered Japanese economy, according to a report Tuesday by the New York-based Economic Cycle Research Institute.

An analysis of 26 key cyclical indicators for Japan's economy compiled by ECRI suggests that the "Japanese recession is almost certain to get worse in the near term, and may become the worst on record," the report said.

The Japanese Diffusion Index, which measures the proportion of the 26 indicators that have improved over the past six months, fell to a new record low of 0.091, breaking below the earlier record low of 0.125 recorded in Jan. 1975.

According to ECRI, the level of the index has historically had a strong correlation with Japan's gross domestic product growth.