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Regional Economic Report (Summary) (January 2013)*

  • This report summarizes the reports from all regional research divisions, mainly at the Bank's branches in Japan, and is based on data and other information gathered for the meeting of general managers of the Bank's branches held today.The English translation is based on the Japanese original.

January 15, 2013
Bank of Japan

Compared with the last assessment in October 2012, eight regions (Tohoku, Hokuriku, Kanto-Koshinetsu, Tokai, Kinki, Chugoku, Shikoku, and Kyushu-Okinawa) reported downward revisions to their economic assessments from the previous report.Many regions reported that the economy had been weakening somewhat or had been relatively weak and the Tohoku and Kyushu-Okinawa regions reported that the recovery in economic activity had come to a pause or the economy had continued to be more or less unchanged as a whole.All these regions attributed these developments mainly to the fact that overseas economies remained in a deceleration phase.

The Hokkaido region, meanwhile, reported that its economic assessment had remained unchanged from the previous report, noting that the economy had been relatively weak in some aspects, although it had continued to pick up.

Table : Regional Economic Report
Region Assessment in October 2012 Changes
from the
previous
assessment1
Assessment in January 2013
Hokkaido The economy has recently begun to show signs of weakness, although signs of a pick-up continue to be observed. unchanged The economy has been relatively weak in some aspects, although it has continued to pick up.
Tohoku Although there seem to be some signs of weakness, the economy has been recovering as a whole, aided mainly by a significant increase in public investment. lower right The recovery in economic activity has come to a pause.
Hokuriku The economy has been more or less unchanged. lower right The economy has been weakening somewhat.
Kanto-Koshinetsu The economy has been more or less unchanged. lower right The economy has been weakening somewhat.
Tokai The recovery in economic activity has come to a pause. lower right The economy has been relatively weak as a whole.
Kinki The economy continues to pause as a whole, but there seem to be some signs of weakness. lower right The economy has been relatively weak.
Chugoku The economy is more or less unchanged as a whole, but there seem to be signs of weakness, particularly in production, mainly reflecting a decline in exports. lower right The economy has been weakening somewhat.
Shikoku The economy has been on a pick-up trend, but the pace of the pick-up has moderated. lower right The pick-up in economic activity has come to a pause, and the economy has shown signs of weakness.
Kyushu-Okinawa The pace of the pick-up in economic activity has moderated as a whole, mainly due to weaker exports and production. lower right The economy has continued to be more or less unchanged as a whole.
  1. With regard to the changes from the previous assessment, arrows pointing to the upper right or lower right indicate changes in the pace of improvement or deterioration compared with the previous assessments, respectively.For example, an acceleration in the pace of improvement or deceleration in the pace of deterioration is indicated with an arrow pointing to the upper right.A horizontal arrow pointing to the right indicates that the pace of improvement or deterioration in economic conditions has remained unchanged compared with the previous assessments.

As for public investment, the Tohoku region reported that it was increasing significantly, and six regions (Hokuriku, Kanto-Koshinetsu, Kinki, Chugoku, Shikoku, and Kyushu-Okinawa) noted that it was increasing or picking up.The Hokkaido and Tokai regions reported that it had stopped declining or had generally been more or less unchanged.

Seven regions (Hokkaido, Tohoku, Hokuriku, Kanto-Koshinetsu, Tokai, Shikoku, and Kyushu-Okinawa) reported that business fixed investment had maintained an increasing trend or had been solid as a whole, mainly reflecting the resilience in nonmanufacturing.However, in manufacturing, some of these regions had observed the effects of the slowdown in overseas economies or signs that firms had suspended their investment plans.The Kinki and Chugoku regions, meanwhile, noted that the recent pick-up in business fixed investment had come to a pause or the pace of the pick-up had slowed, mainly because improvement in corporate profits had leveled off.

As for private consumption, three regions (Hokkaido, Hokuriku, and Chugoku) reported that it had been weakening somewhat.The Kinki and Shikoku regions noted that private consumption had shown signs of weakness, although it had remained more or less unchanged or that it had fallen back in some aspects, in response to the ending of policy measures.Meanwhile, four regions (Tohoku, Kanto-Koshinetsu, Tokai, and Kyushu-Okinawa) reported that private consumption had been solid.

As for sales at large retail stores, the Tohoku and Kyushu-Okinawa regions reported that they had been solid, and the Shikoku region noted that they had been more or less unchanged.On the other hand, the Hokkaido region reported that they had been somewhat weak due partly to the effects of unfavorable weather conditions.The Hokuriku region also noted that sales had been relatively weak.Four regions (Kanto-Koshinetsu, Tokai, Kinki, and Chugoku), meanwhile, reported that sales at supermarkets were relatively weak.

Most regions reported that automobile sales were declining or below the previous year's level, reflecting the ending of subsidies for purchasing energy-efficient cars.However, some regions noted that the effects of a decline following a rise, in response to the ending of subsidies, had recently begun to wane.

Many regions reported that sales of household electrical appliances had been sluggish or were below the previous year's level: sales of flat-panel televisions had been sluggish while those of smartphones and energy-efficient white goods were firm.

Many regions reported that travel-related demand was picking up or had been firm.

As for housing investment, the Tohoku region reported that it was increasing, and seven regions (Hokkaido, Hokuriku, Kanto-Koshinetsu, Kinki, Chugoku, Shikoku, and Kyushu-Okinawa) reported that it was picking up.The Tokai region noted that it had been solid.

As for production, eight regions (Hokkaido, Tohoku, Kanto-Koshinetsu, Tokai, Kinki, Chugoku, Shikoku, and Kyushu-Okinawa) reported that it was declining mainly due to the fact that overseas economies remained in a deceleration phase.The Hokuriku region noted that production had continued to be at a high level as a whole, but the effects of the slowdown in overseas economies had begun to spread.

By industry, six regions (Hokkaido, Kanto-Koshinetsu, Tokai, Chugoku, Shikoku, and Kyushu-Okinawa) reported that production in transportation equipment was declining or that there was a further decline in capacity utilization.Many regions also reported that production in general machinery as well as iron and steel was declining.Regarding production in electronic parts and devices, many regions reported that it had been relatively weak as a whole, as that for household electrical appliances and personal computers had been sluggish while that for smartphones had been favorable.Meanwhile, production in chemicals showed mixed developments.Specifically, some regions noted that it had been maintained at a high level, particularly in medicinal pharmaceutical products, while some other regions noted that there were signs that firms had reduced their capacity utilization due to sluggish external demand, particularly from Asia.

As for the employment and income situation, many regions reported that improvement in supply and demand conditions in the labor market had come to a pause as the severity continued.

Many regions reported that improvement in the employment situation had come to a pause or that the recent improving trend had paused.As for household income, three regions (Hokkaido, Kanto-Koshinetsu, and Chugoku) reported that it had continued to be relatively weak, and the Hokuriku region reported that the pick-up had come to a pause.Four regions (Tokai, Kinki, Shikoku, and Kyushu-Okinawa), meanwhile, noted that household income had been more or less unchanged or was generally at the previous year's level.

Table :
Region Public investment Business fixed
investment
Private
consumption
Housing
investment
Production Employment and income
Hokkaido Has stopped declining Picking up, particularly in manufacturing Has been weakening somewhat Picking up, particularly in the construction of houses for rent Declining, mainly due to the effects of the slowdown in overseas economies The labor market has been picking up moderately amid the severity, but household income has been relatively weak
Tohoku Increasing significantly, primarily in construction orders related to the restoration following the earthquake disaster Increasing Has been solid Increasing, partly due to reconstruction demand stemming from the disaster Declining somewhat due to the effects of the slowdown in overseas economies Improvement in the employment situation has come to a pause
Hokuriku Increasing, particularly in construction orders for facilities related to the Hokuriku bullet train line and construction orders related to the strengthening of elementary and junior high school buildings against earthquakes Picking up, particularly in manufacturing, although the effects of the slowdown in overseas economies have been observed Has been relatively weak Picking up Has continued to be at a high level as a whole, but the effects of the slowdown in overseas economies have begun to spread The pick-up in the employment situation has come to a pause.The pick-up in household income has come to a pause.
Kanto-Koshinetsu Has been on an increasing trend Has maintained an increasing trend as a whole, particularly in nonmanufacturing, despite signs that manufacturers have suspended their investment plans Has been solid Picking up Declining, mainly due to the slowdown in overseas economies Improvement in the employment and household income situation has come to a pause
Tokai Has generally been more or less unchanged Increasing steadily Has been solid Has been solid Declining The employment and household income situation has been relatively weak
Kinki Increasing The pace of the pick-up has slowed, mainly in manufacturing, as improvement in corporate profits has leveled off Has shown signs of weakness, although it has remained more or less unchanged Picking up Declining, mainly due to the effects of the slowdown in overseas economies, and inventories have also been at a relatively high level Improvement in supply and demand conditions in the labor market has come to a pause.With fluctuations smoothed out, household income has generally remained more or less unchanged, despite some signs of weakness in wages.
Chugoku Has begun to pick up moderately The recent pick-up has come to a pause Has been relatively weak Has continued to pick up moderately Declining moderately The employment situation continues to be severe as reflected in the employee cutbacks by some manufacturers, while mismatches in the labor market continue to persist: there are few applications from job seekers for certain occupations where active recruitment is taking place.Household income continues to be weak, mainly reflecting firms' restraint in personnel expenses.
Shikoku Has been on a pick-up trend Has been solid Has been more or less unchanged, although it has fallen back in some aspects in response to the ending of policy measures Picking up Has been somewhat weak The recent improving trend in the employment and household income situation has paused
Kyushu-Okinawa Picking up Has been exceeding the previous year's level, despite signs that firms have suspended their investment plans Has remained solid as a whole Picking up Has remained depressed as a whole, as an increasing number of firms have begun to reduce their capacity utilization mainly due to the fact that overseas economies remain in a deceleration phase The employment and household income situation has remained severe, and the labor market has been relatively weak, particularly in manufacturing

Appendix: Prefectures Included in Each Region

Table : Appendix: Prefectures Included in Each Region
Region Prefectures
Hokkaido Hokkaido
Tohoku Aomori, Iwate, Miyagi, Akita, Yamagata, and Fukushima
Hokuriku Toyama, Ishikawa, and Fukui
Kanto-Koshinetsu Ibaraki, Tochigi, Gunma, Saitama, Chiba, Tokyo, Kanagawa, Niigata, Yamanashi, and Nagano
Tokai Gifu, Shizuoka, Aichi, and Mie
Kinki Shiga, Kyoto, Osaka, Hyogo, Nara, and Wakayama
Chugoku Tottori, Shimane, Okayama, Hiroshima, and Yamaguchi
Shikoku Tokushima, Kagawa, Ehime, and Kochi
Kyushu-Okinawa Fukuoka, Saga, Nagasaki, Kumamoto, Oita, Miyazaki, Kagoshima, and Okinawa

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