| Japan unemployment rate worsens while household spending rises |
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| Wednesday, 31 October 2007 | |
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TOKYO (AP) -- Japan got mixed economic news Tuesday as data from September showed the unemployment rate had worsened while household spending rose at its fastest pace in 3 1/2 years. Japan's unemployment rate rose to 4.0 percent from 3.8 percent in August, the Ministry of Internal Affairs and Communications. That was the highest rate since March. But separate data from the same agency showed that overall household spending rose 3.2 percent in September from a year earlier due in part to healthy sales of durable goods. Analysts say the data indicate that although consumer spending in the world's second-largest economy is showing signs of improving, it may not be able to sustain such low unemployment levels, which could start to influence consumption. Japanese policy makers expressed mixed views on the future course of the nation's labor market at news conferences following the morning Cabinet meeting. Finance Minister Fukushiro Nukaga took a more cautious approach, however, saying that it raises the question of whether the job market is slackening, adding that he wants to analyze it more closely. Economy Minister Hiroko Ota said despite the worsening employment situation, there is "no reason to take it too seriously" because industrial production is picking up. A slowdown in domestic demand would make it more difficult for the Bank of Japan to raise interest rates later this year. The BOJ last hiked its benchmark interest rate in February to 0.5 percent. The bank is slated to hold a one-day rates policy meeting Wednesday. In July, the jobless rate fell to 3.6 percent, its lowest in almost a decade. The ministry said that the total number of people without jobs fell for the 22nd straight month in September, decreasing by 110,000 from the same month a year earlier to 2.69 million. Trackback(0)
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