“Irrational Exuberance,” Mediocre Cyclical United States Economic Growth with GDP Two Trillion Dollars below Trend, Contracting Real Private Fixed Investment, World Inflation Waves, United States Housing Collapse, Unresolved US Balance of Payments Deficits and Fiscal Imbalance Threatening Risk Premium on Treasury Securities, World Cyclical Slow Growth and Global Recession Risk: Part VI

 

“Irrational Exuberance,” Mediocre Cyclical United States Economic Growth with GDP Two Trillion Dollars below Trend, Contracting Real Private Fixed Investment, World Inflation Waves, United States Housing Collapse, Unresolved US Balance of Payments Deficits and Fiscal Imbalance Threatening Risk Premium on Treasury Securities, World Cyclical Slow Growth and Global Recession Risk

Carlos M. Pelaez

© Carlos M. Pelaez, 2009, 2010, 2011, 2012, 2013, 2014, 2015

I Mediocre Cyclical United States Economic Growth with GDP Two Trillion Dollars below Trend

IA Mediocre Cyclical United States Economic Growth

IA1 Contracting Real Private Fixed Investment

I World Inflation Waves

IA Appendix: Transmission of Unconventional Monetary Policy

IB1 Theory

IB2 Policy

IB3 Evidence

IB4 Unwinding Strategy

IC United States Inflation

IC Long-term US Inflation

ID Current US Inflation

IE Theory and Reality of Economic History, Cyclical Slow Growth Not Secular Stagnation and Monetary Policy Based on Fear of Deflation

IIA United States Housing Collapse

IIB Unresolved US Balance of Payments Deficits and Fiscal Imbalance Threatening Risk Premium on Treasury Securities

III World Financial Turbulence

IIIA Financial Risks

IIIE Appendix Euro Zone Survival Risk

IIIF Appendix on Sovereign Bond Valuation

IV Global Inflation

V World Economic Slowdown

VA United States

VB Japan

VC China

VD Euro Area

VE Germany

VF France

VG Italy

VH United Kingdom

VI Valuation of Risk Financial Assets

VII Economic Indicators

VIII Interest Rates

IX Conclusion

References

Appendixes

Appendix I The Great Inflation

IIIB Appendix on Safe Haven Currencies

IIIC Appendix on Fiscal Compact

IIID Appendix on European Central Bank Large Scale Lender of Last Resort

IIIG Appendix on Deficit Financing of Growth and the Debt Crisis

IIIGA Monetary Policy with Deficit Financing of Economic Growth

IIIGB Adjustment during the Debt Crisis of the 1980s

V World Economic Slowdown. Table V-1 is constructed with the database of the IMF (http://www.imf.org/external/ns/cs.aspx?id=28) to show GDP in dollars in 2012 and the growth rate of real GDP of the world and selected regional countries from 2013 to 2016. The data illustrate the concept often repeated of “two-speed recovery” of the world economy from the recession of 2007 to 2009. The IMF has changed its forecast of the world economy to 3.3 percent in 2013 but accelerating to 3.3 percent in 2014, 3.8 percent in 2015 and 4.0 percent in 2016. Slow-speed recovery occurs in the “major advanced economies” of the G7 that account for $34,523 billion of world output of $72,688 billion, or 47.5 percent, but are projected to grow at much lower rates than world output, 1.9 percent on average from 2013 to 2016 in contrast with 3.6 percent for the world as a whole. While the world would grow 15.2 percent in the four years from 2013 to 2016, the G7 as a whole would grow 8.5 percent. The difference in dollars of 2012 is rather high: growing by 15.2 percent would add around $11.0 trillion of output to the world economy, or roughly, two times the output of the economy of Japan of $5,938 billion but growing by 8.0 percent would add $5.8 trillion of output to the world, or about the output of Japan in 2012. The “two speed” concept is in reference to the growth of the 150 countries labeled as emerging and developing economies (EMDE) with joint output in 2012 of $27,512 billion, or 37.8 percent of world output. The EMDEs would grow cumulatively 20.7 percent or at the average yearly rate of 4.8 percent, contributing $5.7 trillion from 2013 to 2016 or the equivalent of somewhat less than the GDP of $8,387 billion of China in 2012. The final four countries in Table V-1 often referred as BRIC (Brazil, Russia, India, China), are large, rapidly growing emerging economies. Their combined output in 2012 adds to $14,511 billion, or 19.9 percent of world output, which is equivalent to 42.0 percent of the combined output of the major advanced economies of the G7.

Table V-1, IMF World Economic Outlook Database Projections of Real GDP Growth

	GDP USD 2012	Real GDP ∆% 2013	Real GDP ∆% 2014	Real GDP ∆% 2015	Real GDP ∆% 2016
World	72,688	3.3	3.3	3.8	4.0
G7	34,523	1.5	1.7	2.3	2.3
Canada	1,709	2.0	2.3	2.4	2.4
France	2,688	0.3	0.4	1.0	1.6
DE	3,428	0.5	1.4	1.5	1.8
Italy	2,014	-1.9	-0.2	0.9	1.3
Japan	5,938	1.5	0.9	0.8	0.8
UK	2,471	1.7	3.2	2.7	2.4
US	16,163	2.2	2.2	3.1	3.0
Euro Area	12,220	-0.4	0.8	1.3	1.7
DE	3,428	0.5	1.4	1.5	1.8
France	2,688	0.3	0.4	1.0	1.6
Italy	2,014	-1.9	-0.2	0.9	1.3
POT	212	-1.4	1.0	1.5	1.7
Ireland	211	-0.3	1.7	2.5	2.5
Greece	249	-3.9	0.6	2.9	3.7
Spain	1,323	-1.2	1.3	1.7	1.8
EMDE	27,512	4.7	4.4	5.0	5.2
Brazil	2,248	2.5	0.3	1.4	2.2
Russia	2,017	1.3	0.2	0.5	1.5
India	1,859	5.0	5.6	6.4	6.5
China	8,387	7.7	7.4	7.1	6.8

Notes; DE: Germany; EMDE: Emerging and Developing Economies (150 countries); POT: Portugal

Source: IMF World Economic Outlook databank http://www.imf.org/external/ns/cs.aspx?id=28

Continuing high rates of unemployment in advanced economies constitute another characteristic of the database of the WEO (http://www.imf.org/external/ns/cs.aspx?id=28). Table V-2 is constructed with the WEO database to provide rates of unemployment from 2012 to 2016 for major countries and regions. In fact, unemployment rates for 2013 in Table I-2 are high for all countries: unusually high for countries with high rates most of the time and unusually high for countries with low rates most of the time. The rates of unemployment are particularly high in 2013 for the countries with sovereign debt difficulties in Europe: 16.2 percent for Portugal (POT), 13.0 percent for Ireland, 27.3 percent for Greece, 26.1 percent for Spain and 12.2 percent for Italy, which is lower but still high. The G7 rate of unemployment is 7.1 percent. Unemployment rates are not likely to decrease substantially if slow growth persists in advanced economies.

Table V-2, IMF World Economic Outlook Database Projections of Unemployment Rate as Percent of Labor Force

	% Labor Force 2012	% Labor Force 2013	% Labor Force 2014	% Labor Force 2015	% Labor Force 2016
World	NA	NA	NA	NA	NA
G7	7.4	7.1	6.5	6.3	6.1
Canada	7.3	7.1	7.0	6.9	6.8
France	9.8	10.3	10.0	10.0	9.9
DE	5.5	5.3	5.3	5.3	5.3
Italy	10.7	12.2	12.6	12.0	11.3
Japan	4.3	4.0	3.7	3.8	3.8
UK	8.0	7.6	6.3	5.8	5.5
US	8.1	7.4	6.3	5.9	5.8
Euro Area	11.3	11.9	11.6	11.2	10.7
DE	5.5	5.3	5.3	5.3	5.3
France	9.8	10.3	10.0	10.0	9.9
Italy	10.7	12.2	12.6	12.0	11.3
POT	15.5	16.2	14.2	13.5	13.0
Ireland	14.7	13.0	11.2	10.5	10.1
Greece	24.2	27.3	25.8	23.8	20.9
Spain	24.8	26.1	24.6	23.5	22.4
EMDE	NA	NA	NA	NA	NA
Brazil	5.5	5.4	5.5	6.1	5.9
Russia	5.5	5.5	5.6	6.5	6.0
India	NA	NA	NA	NA	NA
China	4.1	4.1	4.1	4.1	4.1

Notes; DE: Germany; EMDE: Emerging and Developing Economies (150 countries)

Source: IMF World Economic Outlook databank http://www.imf.org/external/ns/cs.aspx?id=28

Table V-3 provides the latest available estimates of GDP for the regions and countries followed in this blog from IQ2012 to IIIQ2014 available now for all countries. There are preliminary estimates for most countries for IVQ2014. Growth is weak throughout most of the world.

• Japan. The GDP of Japan increased 1.1 percent in IQ2012, 4.4 percent at SAAR (seasonally adjusted annual rate) and 3.5 percent relative to a year earlier but part of the jump could be the low level a year earlier because of the Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. Japan is experiencing difficulties with the overvalued yen because of worldwide capital flight originating in zero interest rates with risk aversion in an environment of softer growth of world trade. Japan’s GDP fell 0.4 percent in IIQ2012 at the seasonally adjusted annual rate (SAAR) of minus 1.5 percent, which is much lower than 4.4 percent in IQ2012. Growth of 3.5 percent in IIQ2012 in Japan relative to IIQ2011 has effects of the low level of output because of Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. Japan’s GDP contracted 0.6 percent in IIIQ2012 at the SAAR of minus 2.2 percent and increased 0.2 percent relative to a year earlier. Japan’s GDP decreased 0.2 percent in IVQ2012 at the SAAR of minus 0.7 percent and changed 0.0 percent relative to a year earlier. Japan grew 1.4 percent in IQ2013 at the SAAR of 5.7 percent and increased 0.5 percent relative to a year earlier. Japan’s GDP increased 0.8 percent in IIQ2013 at the SAAR of 3.2 percent and increased 1.4 percent relative to a year earlier. Japan’s GDP grew 0.4 percent in IIIQ2013 at the SAAR of 1.5 percent and increased 2.2 percent relative to a year earlier. In IVQ2013, Japan’s GDP decreased 0.4 percent at the SAAR of minus 1.4 percent, increasing 2.3 percent relative to a year earlier. Japan’s GDP increased 1.3 percent in IQ2014 at the SAAR of 5.5 percent and increased 2.4 percent relative to a year earlier. In IIQ2014, Japan’s GDP fell 1.7 percent at the SAAR of minus 6.7 percent and fell 0.4 percent relative to a year earlier. Japan’s GDP contracted 0.6 percent in IIIQ2014 at the SAAR of minus 2.3 percent and fell 1.4 percent relative to a year earlier. In IVQ2014, Japan’s GDP grew 0.6 percent, at the SAAR of 2.2 percent, decreasing 0.5 percent relative to a year earlier.
• China. China’s GDP grew 1.4 percent in IQ2012, annualizing to 5.7 percent, and 8.1 percent relative to a year earlier. The GDP of China grew at 2.1 percent in IIQ2012, which annualizes to 8.7 percent and 7.6 percent relative to a year earlier. China grew at 2.0 percent in IIIQ2012, which annualizes at 8.2 percent and 7.4 percent relative to a year earlier. In IVQ2012, China grew at 1.9 percent, which annualizes at 7.8 percent, and 7.9 percent in IVQ2012 relative to IVQ2011. In IQ2013, China grew at 1.7 percent, which annualizes at 7.0 percent and 7.8 percent relative to a year earlier. In IIQ2013, China grew at 1.8 percent, which annualizes at 7.4 percent and 7.5 percent relative to a year earlier. China grew at 2.3 percent in IIIQ2013, which annualizes at 9.5 percent and 7.9 percent relative to a year earlier. China grew at 1.8 percent in IVQ2013, which annualized to 7.4 percent and 7.6 percent relative to a year earlier. China’s GDP grew 1.6 percent in IQ2014, which annualizes to 6.6 percent, and 7.4 percent relative to a year earlier. China’s GDP grew 1.9 percent in IIQ2014, which annualizes at 7.8 percent, and 7.5 percent relative to a year earlier. China’s GDP grew 1.9 percent in IIIQ2014, which is equivalent to 7.8 percent in a year, and 7.3 percent relative to a year earlier. The GDP of China grew 1.5 percent in IVQ2014, which annualizes at 6.1 percent, and 7.3 percent relative to a year earlier. There is decennial change in leadership in China (http://www.xinhuanet.com/english/special/18cpcnc/index.htm). Growth rates of GDP of China in a quarter relative to the same quarter a year earlier have been declining from 2011 to 2014.
• Euro Area. GDP fell 0.1 percent in the euro area in IQ2012 and decreased 0.3 in IQ2012 relative to a year earlier. Euro area GDP contracted 0.3 percent IIQ2012 and fell 0.6 percent relative to a year earlier. In IIIQ2012, euro area GDP fell 0.1 percent and declined 0.8 percent relative to a year earlier. In IVQ2012, euro area GDP fell 0.4 percent relative to the prior quarter and fell 0.9 percent relative to a year earlier. In IQ2013, the GDP of the euro area fell 0.4 percent and decreased 1.2 percent relative to a year earlier. The GDP of the euro area increased 0.3 percent in IIQ2013 and fell 0.6 percent relative to a year earlier. In IIIQ2013, euro area GDP increased 0.2 percent and fell 0.3 percent relative to a year earlier. The GDP of the euro area increased 0.2 percent in IVQ2013 and increased 0.4 percent relative to a year earlier. In IQ2014, the GDP of the euro area increased 0.3 percent and 1.1 percent relative to a year earlier. The GDP of the euro area increased 0.1 percent in IIQ2014 and increased 0.8 percent relative to a year earlier. The euro area’s GDP increased 0.2 percent in IIIQ2014 and increased 0.8 percent relative to a year earlier. The GDP of the euro area increased 0.3 percent in IVQ2014 and increased 0.9 percent relative to a year earlier.
• Germany. The GDP of Germany increased 0.3 percent in IQ2012 and 1.5 percent relative to a year earlier. In IIQ2012, Germany’s GDP increased 0.1 percent and increased 0.3 percent relative to a year earlier but 0.8 percent relative to a year earlier when adjusted for calendar (CA) effects. In IIIQ2012, Germany’s GDP increased 0.1 percent and 0.1 percent relative to a year earlier. Germany’s GDP contracted 0.4 percent in IVQ2012 and decreased 0.3 percent relative to a year earlier. In IQ2013, Germany’s GDP decreased 0.4 percent and fell 1.8 percent relative to a year earlier. In IIQ2013, Germany’s GDP increased 0.8 percent and 0.5 percent relative to a year earlier. The GDP of Germany increased 0.3 percent in IIIQ2013 and 0.8 percent relative to a year earlier. In IVQ2013, Germany’s GDP increased 0.4 percent and 1.0 percent relative to a year earlier. The GDP of Germany increased 0.8 percent in IQ2014 and 2.6 percent relative to a year earlier. In IIQ2014, Germany’s GDP contracted 0.1 percent and increased 1.0 percent relative to a year earlier. The GDP of Germany increased 0.1 percent in IIIQ2014 and increased 1.2 percent relative to a year earlier. Germany’s GDP increased 0.7 percent in IVQ2014 and increased 1.6 percent relative to a year earlier.
• United States. Growth of US GDP in IQ2012 was 0.6 percent, at SAAR of 2.3 percent and higher by 2.6 percent relative to IQ2011. US GDP increased 0.4 percent in IIQ2012, 1.6 percent at SAAR and 2.3 percent relative to a year earlier. In IIIQ2012, US GDP grew 0.6 percent, 2.5 percent at SAAR and 2.7 percent relative to IIIQ2011. In IVQ2012, US GDP grew 0.0 percent, 0.1 percent at SAAR and 1.6 percent relative to IVQ2011. In IQ2013, US GDP grew at 2.7 percent SAAR, 0.7 percent relative to the prior quarter and 1.7 percent relative to the same quarter in 2013. In IIQ2013, US GDP grew at 1.8 percent in SAAR, 0.4 percent relative to the prior quarter and 1.8 percent relative to IIQ2012. US GDP grew at 4.5 percent in SAAR in IIIQ2013, 1.1 percent relative to the prior quarter and 2.3 percent relative to the same quarter a year earlier (Section I and earlier (http://cmpassocregulationblog.blogspot.com/2015/02/financial-and-international.html) with weak hiring (http://cmpassocregulationblog.blogspot.com/2015/02/g20-monetary-policy-recovery-without.html). In IVQ2013, US GDP grew 0.9 percent at 3.5 percent SAAR and 3.1 percent relative to a year earlier. In IQ2014, US GDP decreased 0.5 percent, increased 1.9 percent relative to a year earlier and fell 2.1 percent at SAAR. In IIQ2014, US GDP increased 1.1 percent at 4.6 percent SAAR and increased 2.6 percent relative to a year earlier. US GDP increased 1.2 percent in IIIQ2014 at 5.0 percent SAAR and increased 2.7 percent relative to a year earlier. In IVQ2014, US GDP increased 0.5 percent at SAAR of 2.2 percent and increased 2.4 percent relative to a year earlier.
• United Kingdom. In IQ2012, UK GDP increased 0.1 percent, increasing 1.0 percent relative to a year earlier. UK GDP fell 0.2 percent in IIQ2012 and increased 0.6 percent relative to a year earlier. UK GDP increased 0.8 percent in IIIQ2012 and increased 0.7 percent relative to a year earlier. UK GDP fell 0.3 percent in IVQ2012 relative to IIIQ2012 and increased 0.4 percent relative to a year earlier. UK GDP increased 0.6 percent in IQ2013 and 0.9 percent relative to a year earlier. UK GDP increased 0.6 percent in IIQ2013 and 1.7 percent relative to a year earlier. In IIIQ2013, UK GDP increased 0.7 percent and 1.6 percent relative to a year earlier. UK GDP increased 0.4 percent in IVQ2013 and 2.4 percent relative to a year earlier. In IQ2014, UK GDP increased 0.7 percent and 2.5 percent relative to a year earlier. UK GDP increased 0.8 percent in IIQ2014 and 2.6 percent relative to a year earlier. In IIIQ2014, UK GDP increased 0.7 percent and increased 2.5 percent relative to a year earlier. UK GDP increased 0.5 percent in IVQ2014 and increased 2.7 percent relative to a year earlier.
• Italy. Italy has experienced decline of GDP in nine consecutive quarters from IIIQ2011 to IIIQ2013 and in IIQ2014 and IIIQ2014. Italy’s GDP fell 0.9 percent in IQ2012 and declined 1.9 percent relative to IQ2011. Italy’s GDP fell 0.4 percent in IIQ2012 and declined 2.4 percent relative to a year earlier. In IIIQ2012, Italy’s GDP fell 0.4 percent and declined 2.5 percent relative to a year earlier. The GDP of Italy contracted 0.8 percent in IVQ2012 and fell 2.5 percent relative to a year earlier. In IQ2013, Italy’s GDP contracted 0.9 percent and fell 2.5 percent relative to a year earlier. Italy’s GDP fell 0.2 percent in IIQ2013 and 2.2 percent relative to a year earlier. The GDP of Italy changed 0.0 percent in IIIQ2013 and declined 1.8 percent relative to a year earlier. Italy’s GDP decreased 0.1 percent in IVQ2013 and decreased 1.2 percent relative to a year earlier. In IQ2014, Italy’s GDP changed 0.0 percent and fell 0.3 percent relative to a year earlier. The GDP of Italy fell 0.2 percent in IIQ2014 and declined 0.4 percent relative to a year earlier. In IIIQ2014, Italy’s GDP contracted 0.1 percent and fell 0.5 percent relative to a year earlier. The GDP of Italy changed 0.0 percent in IVQ20214 and declined 0.3 percent relative to a year earlier
• France. France’s GDP increased 0.2 percent in IQ2012 and increased 0.6 percent relative to a year earlier. France’s GDP decreased 0.3 percent in IIQ2012 and increased 0.4 percent relative to a year earlier. In IIIQ2012, France’s GDP increased 0.2 percent and increased 0.4 percent relative to a year earlier. France’s GDP fell 0.2 percent in IVQ2012 and changed 0.0 percent relative to a year earlier. In IQ2013, France’s GDP changed 0.0 percent and declined 0.2 percent relative to a year earlier. The GDP of France increased 0.7 percent in IIQ2013 and 0.7 percent relative to a year earlier. France’s GDP decreased 0.1 percent in IIIQ2013 and increased 0.3 percent relative to a year earlier. The GDP of France increased 0.3 percent in IVQ2013 and 0.8 percent relative to a year earlier. In IQ2014, France’s GDP changed 0.0 percent and increased 0.8 percent relative to a year earlier. In IIQ2014, France’s GDP contracted 0.1 percent and changed 0.0 percent relative to a year earlier. France’s GDP increased 0.3 percent in IIIQ2014 and increased 0.4 percent relative to a year earlier. The GDP of France increased 0.1 percent in IVQ2014 and increased 0.2 percent relative to a year earlier

Table V-3, Percentage Changes of GDP Quarter on Prior Quarter and on Same Quarter Year Earlier, ∆%

	IQ2012/IVQ2011	IQ2012/IQ2011
United States	QOQ: 0.6        SAAR: 2.3	2.6
Japan	QOQ: 1.1 SAAR: 4.4	3.5
China	1.4	8.1
Euro Area	-0.1	-0.3
Germany	0.3	1.5
France	0.2	0.6
Italy	-0.9	-1.9
United Kingdom	0.1	1.0
	IIQ2012/IQ2012	IIQ2012/IIQ2011
United States	QOQ: 0.4         SAAR: 1.6	2.3
Japan	QOQ: -0.4 SAAR: -1.5	3.5
China	2.1	7.6
Euro Area	-0.3	-0.6
Germany	0.1	0.3 0.8 CA
France	-0.3	0.4
Italy	-0.4	-2.4
United Kingdom	-0.2	0.6
	IIIQ2012/ IIQ2012	IIIQ2012/ IIIQ2011
United States	QOQ: 0.6  SAAR: 2.5	2.7
Japan	QOQ: –0.6 SAAR: –2.2	0.2
China	2.0	7.4
Euro Area	-0.1	-0.8
Germany	0.1	0.1
France	0.2	0.4
Italy	-0.4	-2.5
United Kingdom	0.8	0.7
	IVQ2012/IIIQ2012	IVQ2012/IVQ2011
United States	QOQ: 0.0 SAAR: 0.1	1.6
Japan	QOQ: -0.2 SAAR: -0.7	0.0
China	1.9	7.9
Euro Area	-0.4	-0.9
Germany	-0.4	-0.3
France	-0.2	0.0
Italy	-0.8	-2.5
United Kingdom	-0.3	0.4
	IQ2013/IVQ2012	IQ2013/IQ2012
United States	QOQ: 0.7 SAAR: 2.7	1.7
Japan	QOQ: 1.4 SAAR: 5.7	0.5
China	1.7	7.8
Euro Area	-0.4	-1.2
Germany	-0.4	-1.8
France	0.0	-0.2
Italy	-0.9	-2.5
UK	0.6	0.9
	IIQ2013/IQ2013	IIQ2013/IIQ2012
United States	QOQ: 0.4 SAAR: 1.8	1.8
Japan	QOQ: 0.8 SAAR: 3.2	1.4
China	1.8	7.5
Euro Area	0.3	-0.6
Germany	0.8	0.5
France	0.7	0.7
Italy	-0.2	-2.2
UK	0.6	1.7
	IIIQ2013/IIQ2013	III/Q2013/  IIIQ2012
USA	QOQ: 1.1 SAAR: 4.5	2.3
Japan	QOQ: 0.4 SAAR: 1.5	2.2
China	2.3	7.9
Euro Area	0.2	-0.3
Germany	0.3	0.8
France	-0.1	0.3
Italy	0.0	-1.8
UK	0.7	1.6
	IVQ2013/IIIQ2013	IVQ2013/IVQ2012
USA	QOQ: 0.9 SAAR: 3.5	3.1
Japan	QOQ: -0.4 SAAR: -1.4	2.3
China	1.8	7.6
Euro Area	0.2	0.4
Germany	0.4	1.0
France	0.3	0.8
Italy	-0.1	-1.2
UK	0.4	2.4
	IQ2014/IVQ2013	IQ2014/IQ2013
USA	QOQ -0.5 SAAR -2.1	1.9
Japan	QOQ: 1.3 SAAR: 5.5	2.4
China	1.6	7.4
Euro Area	0.3	1.1
Germany	0.8	2.6
France	0.0	0.8
Italy	0.0	-0.3
UK	0.7	2.5
	IIQ2014/IQ2014	IIQ2014/IIQ2013
USA	QOQ 1.1 SAAR 4.6	2.6
Japan	QOQ: -1.7 SAAR: -6.7	-0.4
China	1.9	7.5
Euro Area	0.1	0.8
Germany	-0.1	1.0
France	-0.1	0.0
Italy	-0.2	-0.4
UK	0.8	2.6
	IIIQ2014/IIQ2014	IIIQ2014/IIIQ2013
USA	QOQ: 1.2 SAAR: 5.0	2.7
Japan	QOQ: -0.6 SAAR: -2.3	-1.4
China	1.9	7.3
Euro Area	0.2	0.8
Germany	0.1	1.2
France	0.3	0.4
Italy	-0.1	-0.4
UK	0.7	2.5
	IVQ2014/IIIQ2014	IVQ2014/IVQ2013
USA	QOQ: 0.5 SAAR: 2.2	2.4
Japan	QOQ: 0.6 SAAR: 2.2	-0.5
China	1.5	7.3
Euro Area	0.3	0.9
Germany	0.7	1.6
France	0.1	0.2
Italy	0.0	-0.3
UK	0.5	2.7

QOQ: Quarter relative to prior quarter; SAAR: seasonally adjusted annual rate

Source: Country Statistical Agencies http://www.census.gov/aboutus/stat_int.html

Table V-4 provides two types of data: growth of exports and imports in the latest available months and in the past 12 months; and contributions of net trade (exports less imports) to growth of real GDP.

• Japan. Japan provides the most worrisome data (http://cmpassocregulationblog.blogspot.com/2015/02/world-financial-turbulence-squeeze-of.html and earlier (http://cmpassocregulationblog.blogspot.com/2015/02/financial-and-international.html and earlier http://cmpassocregulationblog.blogspot.com/2014/12/patience-on-interest-rate-increases.html and earlier (http://cmpassocregulationblog.blogspot.com/2014/11/squeeze-of-economic-activity-by-carry.html and earlier http://cmpassocregulationblog.blogspot.com/2014/09/world-inflation-waves-squeeze-of.html and earlier http://cmpassocregulationblog.blogspot.com/2014/08/monetary-policy-world-inflation-waves.html and earlier http://cmpassocregulationblog.blogspot.com/2014/07/world-inflation-waves-united-states.html and earlier (http://cmpassocregulationblog.blogspot.com/2014/06/valuation-risks-world-inflation-waves.html and earlier http://cmpassocregulationblog.blogspot.com/2014/05/united-states-commercial-banks-assets.html and earlier http://cmpassocregulationblog.blogspot.com/2014/05/financial-volatility-mediocre-cyclical.html and earlier http://cmpassocregulationblog.blogspot.com/2014/03/interest-rate-risks-world-inflation.html and earlier http://cmpassocregulationblog.blogspot.com/2014/03/financial-risks-slow-cyclical-united.html and earlier http://cmpassocregulationblog.blogspot.com/2014/02/mediocre-cyclical-united-states.html and earlier http://cmpassocregulationblog.blogspot.com/2013/12/tapering-quantitative-easing-mediocre.html and earlier http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-zero-interest-rates-world.html http://cmpassocregulationblog.blogspot.com/2013/11/global-financial-risk-world-inflation.html http://cmpassocregulationblog.blogspot.com/2013/09/duration-dumping-and-peaking-valuations_8763.html http://cmpass ocregulationblog.blogspot.com/2013/08/interest-rate-risks-duration-dumping.html and earlier http://cmpassocregulationblog.blogspot.com/2013/07/duration-dumping-steepening-yield-curve.html and earlier http://cmpassocregulationblog.blogspot.com/2013/06/paring-quantitative-easing-policy-and_4699.html and earlier at http://cmpassocregulationblog.blogspot.com/2013/05/united-states-commercial-banks-assets.html and earlier http://cmpassocregulationblog.blogspot.com/2013/04/world-inflation-waves-squeeze-of.html and earlier http://cmpassocregulationblog.blogspot.com/2013/03/united-states-commercial-banks-assets.html and earlier at http://cmpassocregulationblog.blogspot.com/2013/02/world-inflation-waves-united-states.html and earlier at http://cmpassocregulationblog.blogspot.com/2013/02/thirty-one-million-unemployed-or.html and earlier http://cmpassocregulationblog.blogspot.com/2012/12/mediocre-and-decelerating-united-states_24.html and earlier http://cmpassocregulationblog.blogspot.com/2012/11/contraction-of-united-states-real_25.html and for GDP http://cmpassocregulationblog.blogspot.com/2013/09/recovery-without-hiring-ten-million.html and earlier http://cmpassocregulationblog.blogspot.com/2013/08/duration-dumping-and-peaking-valuations.html and earlier http://cmpassocreulationblog.blogspot.com/2013/02/recovery-without-hiring-united-states.html). In Jan 2015, Japan’s exports increased 17.0 percent in 12 months while imports decreased 9.0 percent. The second part of Table V-4 shows that net trade deducted 1.4 percentage points from Japan’s growth of GDP in IIQ2012, deducted 1.9 percentage points from GDP growth in IIIQ2012 and deducted 0.4 percentage points from GDP growth in IVQ2012. Net trade added 0.3 percentage points to GDP growth in IQ2012, 1.6 percentage points in IQ2013 and 0.2 percentage points in IIQ2013. In IIIQ2013, net trade deducted 1.5 percentage points from GDP growth in Japan. Net trade ducted 2.1 percentage points from GDP growth in Japan in IVQ2013. Net trade deducted 1.2 percentage point from GDP growth of Japan in IQ2014. Net trade added 4.2 percentage points to GDP growth in IIQ2014. Net trade added 0.2 percentage points to GDP growth in IIIQ2014 and added 0.9 percentage points in IVQ2014.

• China. In Jan 2015, China exports decreased 3.3 percent relative to a year earlier and imports decreased 19.9 percent.
• Germany. Germany’s exports increased 3.4 percent in the month of Dec 2014 and increased 10.0 percent in the 12 months ending in Dec 2014. Germany’s imports decreased 0.8 percent in the month of Dec 2014 and increased 4.0 percent in the 12 months ending in Dec. Net trade contributed 0.8 percentage points to growth of GDP in IQ2012, contributed 0.4 percentage points in IIQ2012, contributed 0.3 percentage points in IIIQ2012, deducted 0.5 percentage points in IVQ2012, deducted 0.3 percentage points in IQ2013 and added 0.1 percentage points in IIQ2013. Net traded deducted 0.5 percentage points from Germany’s GDP growth in IIIQ2013 and added 0.5 percentage points to GDP growth in IVQ2013. Net trade deducted 0.1 percentage points from GDP growth in IQ2014. Net trade added 0.0 percentage points to GDP growth in IIQ2014 and added 0.4 percentage points in IIIQ2014. Net trade added 0.2 percentage points to GDP growth in IVQ2014.
• United Kingdom. Net trade contributed 0.7 percentage points in IIQ2013. In IIIQ2013, net trade deducted 1.7 percentage points from UK growth. Net trade contributed 0.1 percentage points to UK value added in IVQ2013. Net trade contributed 0.2 percentage points to UK value added in IQ2014 and 0.3 percentage points in IIQ2014. Net trade deducted 0.7 percentage points to GDP growth in IIIQ2014 and added 0.6 percentage points in IVQ2014.
• France. France’s exports increased 1.8 percent in Dec 2014 while imports increased 2.6 percent. France’s exports increased 3.7 percent in the 12 months ending in Dec 2014 and imports decreased 1.4 percent relative to a year earlier. Net traded added 0.1 percentage points to France’s GDP in IIIQ2012 and 0.1 percentage points in IVQ2012. Net trade deducted 0.1 percentage points from France’s GDP growth in IQ2013 and added 0.3 percentage points in IIQ2013, deducting 1.7 percentage points in IIIQ2013. Net trade added 0.1 percentage points to France’s GDP in IVQ2013 and deducted 0.1 percentage points in IQ2014. Net trade deducted 0.2 percentage points from France’s GDP growth in IIQ2014 and deducted 0.2 percentage points in IIIQ2014. Net trade added 0.1 percentage points to France’s GDP growth in IVQ2014.

United States. US exports increased 0.8 percent in Dec 2014 and goods exports increased 2.8 percent in Jan-Dec 2014 relative to a year earlier. Imports increased 2.2 percent in Dec 2014 and goods imports increased 3.04 percent in Jan-Dec 2014 relative to a year earlier. Net trade deducted 0.04 percentage points from GDP growth in IIQ2012 and added 0.39 percentage points in IIIQ2012 and 0.79 percentage points in IVQ2012. Net trade deducted 0.08 percentage points from US GDP growth in IQ2013 and deducted 0.54 percentage points in IIQ2013. Net traded added 0.59 percentage points to US GDP growth in IIIQ2013. Net trade added 1.08 percentage points to US GDP growth in IVQ2013. Net trade deducted 1.66 percentage points from US GDP growth in IQ2014 and deducted 0.34 percentage points in IIQ2014. Net trade added 0.78 percentage points to IIIQ2014. Net trade deducted 1.15 percentage points from GDP growth in IVQ2014. Industrial production increased 0.2 percent in Jan 2015 and decreased 0.3 percent in Dec 2014 after increasing 1.1 percent in Nov 2014. The Federal Reserve completed its annual revision of industrial production and capacity utilization on Mar 28, 2014 (http://www.federalreserve.gov/releases/g17/revisions/Current/DefaultRev.htm). The report of the Board of Governors of the Federal Reserve System states (http://www.federalreserve.gov/releases/g17/Current/default.htm):

“Industrial production increased 0.2 percent in January after decreasing 0.3 percent in December. The rates of change in output for September through December are all slightly lower than previously published; even so, production is estimated to have advanced at an annual rate of 4.3 percent in the fourth quarter of last year. In January, manufacturing output moved up 0.2 percent and was 5.6 percent above its year-earlier level. The index for mining decreased 1.0 percent, with the decline more than accounted for by a substantial drop in the index for oil and gas well drilling and related support activities. The output of utilities increased 2.3 percent. At 106.2 percent of its 2007 average, total industrial production in January was 4.8 percent above its level of a year earlier. Capacity utilization for the industrial sector was unchanged in January at 79.4 percent, a rate that is 0.7 percentage point below its long-run (1972–2014) average.”

In the six months ending in Jan 2015, United States national industrial production accumulated increase of 1.6 percent at the annual equivalent rate of 3.2 percent, which is lower than growth of 4.8 percent in the 12 months ending in Jan 2015. Excluding growth of 1.1 percent in Nov 2014, growth in the remaining five months from Aug 2014 to Jan 2015 accumulated to 0.5 percent or 1.2 percent annual equivalent. Industrial production declined in two of the past six months. Industrial production expanded at annual equivalent 4.1 percent in the most recent quarter from Nov 2014 to Jan 2015 and at 2.4 percent in the prior quarter Aug to Oct 2014. Business equipment accumulated growth of 1.4 percent in the six months from Aug 2014 to Jan 2015 at the annual equivalent rate of 2.8 percent, which is lower than growth of 7.3 percent in the 12 months ending in Jan 2015. The Fed analyzes capacity utilization of total industry in its report (http://www.federalreserve.gov/releases/g17/Current/default.htm): “Capacity utilization for the industrial sector was unchanged in January at 79.4 percent, a rate that is 0.7 percentage point below its long-run (1972–2014) average.” United States industry apparently decelerated to a lower growth rate followed by possible acceleration and oscillating growth in past months.

Manufacturing fell 21.9 from the peak in Jun 2007 to the trough in Apr 2009 and increased by 25.2 percent from the trough in Apr 2009 to Dec 2014. Manufacturing grew 24.2 percent from the trough in Apr 2009 to Jan 2015. Manufacturing output in Jan 2015 is 3.1 percent below the peak in Jun 2007. Growth at trend in the entire cycle from IVQ2007 to IVQ2014 would have accumulated to 23.0 percent. GDP in IVQ2014 would be $18,438.0 billion (in constant dollars of 2009) if the US had grown at trend, which is higher by $2,126.4 billion than actual $16,311.6 billion. There are about two trillion dollars of GDP less than at trend, explaining the 28.3 million unemployed or underemployed equivalent to actual unemployment of 17.1 percent of the effective labor force (http://cmpassocregulationblog.blogspot.com/2015/02/job-creation-and-monetary-policy-twenty.html and earlier http://cmpassocregulationblog.blogspot.com/2015/01/fluctuating-valuations-of-risk.html and earlier http://cmpassocregulationblog.blogspot.com/2014/12/financial-risks-twenty-six-million.html). US GDP in IVQ2014 is 11.5 percent lower than at trend. US GDP grew from $14,991.8 billion in IVQ2007 in constant dollars to $16,311.6 billion in IVQ2014 or 8.8 percent at the average annual equivalent rate of 1.2 percent. Cochrane (2014Jul2) estimates US GDP at more than 10 percent below trend. The US missed the opportunity to grow at higher rates during the expansion and it is difficult to catch up because growth rates in the final periods of expansions tend to decline. The US missed the opportunity for recovery of output and employment always afforded in the first four quarters of expansion from recessions. Zero interest rates and quantitative easing were not required or present in successful cyclical expansions and in secular economic growth at 3.0 percent per year and 2.0 percent per capita as measured by Lucas (2011May). There is cyclical uncommonly slow growth in the US instead of allegations of secular stagnation. There is similar behavior in manufacturing. There is classic research on analyzing deviations of output from trend (see for example Schumpeter 1939, Hicks 1950, Lucas 1975, Sargent and Sims 1977). The long-term trend is growth at average 3.3 percent per year from Jan 1919 to Jan 2015. Growth at 3.3 percent per year would raise the NSA index of manufacturing output from 99.2392 in Dec 2007 to 124.8993 in Jan 2015. The actual index NSA in Jan 2015 is 99.8883, which is 20.0 percent below trend. Manufacturing output grew at average 2.4 percent between Dec 1986 and Dec 2014, raising the index at trend to 117.3927 in Jan 2015. The output of manufacturing at 99.8883 in Jan 2015 is 14.9 percent below trend under this alternative calculation.

Table V-4, Growth of Trade and Contributions of Net Trade to GDP Growth, ∆% and % Points

	Exports M ∆%	Exports 12 M ∆%	Imports M ∆%	Imports 12 M ∆%
USA	0.8 Dec	2.8 Jan-Dec	2.2 Nov	3.4 Jan-Dec
Japan		Jan 2015 17.0 Dec 12.9 Nov 4.9 Oct 9.6 Sep 6.9 Aug -1.3 Jul 3.9 Jun -2.0 May 2014 -2.7 Apr 2014 5.1 Mar 2014 1.8 Feb 2014 9.5 Jan 2014 9.5 Dec 2013 15.3 Nov 2013 18.4 Oct 2013 18.6 Sep 2013 11.5 Aug 2013 14.7 Jul 2013 12.2 Jun 2013 7.4 May 2013 10.1 Apr 2013 3.8 Mar 2013 1.1 Feb 2013 -2.9 Jan 2013 6.4 Dec -5.8 Nov -4.1 Oct -6.5 Sep -10.3 Aug -5.8 Jul -8.1		Jan 2015 -9.0 Dec 1.9 Nov -1.7 Oct 2.7 Sep 6.2 Aug -1.5 Jul 2.3 Jun 8.4 May 2014 -3.6 Apr 2013 3.4 Mar 2014 18.1 Feb 2014 9.0 Jan 2014 25.0 Dec 2013 24.7 Nov 2013 21.1 Oct 2013 26.1 Sep 2013 16.5 Aug 2013 16.0 Jul 2013 19.6 Jun 2013 11.8 May 2013 10.0 Apr 2013 9.4 Mar 2013 5.5 Feb 2013 7.3 Jan 2013 7.3 Dec 1.9 Nov 0.8 Oct -1.6 Sep 4.1 Aug -5.4 Jul 2.1
China		2015 -3.3 Jan 2014 9.7 Dec 4.7 Nov 11.6 Oct 15.3 Sep 9.4 Aug 14.5 Jul 7.2 Jun 7.0 May 0.9 Apr -6.6 Mar -18.1 Feb 10.6 Jan 2013 4.3 Dec 12.7 Nov 5.6 Oct -0.3 Sep 7.2 Aug 5.1 Jul -3.1 Jun 1.0 May 14.7 Apr 10.0 Mar 21.8 Feb 25.0 Jan		2015 -19.9 Jan 2014 -2.4 Dec -6.7 Nov 4.6 Oct 7.0 Sep -2.4 Aug -1.6 Jul 5.5 Jun -1.6 May -0.8 Apr -11.3 Mar 10.1 Feb 10.0 Jan 2013 8.3 Dec 5.3 Nov 7.6 Oct 7.4 Sep 7.0 Aug 10.9 Jul -0.7 Jun -0.3 May 16.8 Apr 14.1 Mar -15.2 Feb 28.8 Jan
Euro Area	8.0 12-M Dec	2.4 Jan-Dec	1.0 12-M Dec	0.1 Jan-Dec
Germany	3.4 Dec CSA	10.0 Dec	-0.8 Dec CSA	4.0 Nov
France Dec	1.8	3.7	2.6	-1.4
Italy Dec	2.6	6.3	-1.6	-1.3
UK	-0.2 Dec	-0.1 Oct-Dec 14 /Oct-Dec 13	-2.2 Dec	-2.2 Oct-Dec 14/Oct-Dec 13
Net Trade % Points GDP Growth	% Points
USA	IVQ2014 -1.15 IIIQ2014 0.78 IIQ2014 -0.34 IQ2014 -1.66 IVQ2013 1.08 IIIQ2013 0.59 IIQ2013 -0.54 IQ2013 -0.08 IVQ2012 +0.79 IIIQ2012 0.39 IIQ2012 -0.04 IQ2012 -0.11
Japan	0.3 IQ2012 -1.4 IIQ2012 -1.9 IIIQ2012 -0.4 IVQ2012 1.6 IQ2013 0.2 IIQ2013 -1.5 IIIQ2013 -2.1 IVQ2013 -1.2 IQ2014 4.2 IIQ2014 0.2 IIIQ2014 0.9 IVQ2014
Germany	IQ2012 0.8 IIQ2012 0.4 IIIQ2012 0.3 IVQ2012 -0.5 IQ2013 -0.3 IIQ2013 0.1 IIIQ2013 -0.5 IVQ2013 0.5 IQ2014 -0.1 IIQ2014 0.0 IIIQ2014 0.4 IVQ2014 0.2
France	0.1 IIIQ2012 0.1 IVQ2012 -0.1 IQ2013 0.3 IIQ2013 -1.7 IIIQ2013 0.1 IVQ2013 -0.1 IQ2014 -0.2 IIQ2014 -0.2 IIIQ2014 0.1 IVQ2014
UK	0.7 IIQ2013 -1.7 IIIQ2013 0.1 IVQ2013 0.2 IQ2014 0.3 IIQ2014 -0.7 IIIQ2014 0.6 IVQ2014

Sources: Country Statistical Agencies http://www.census.gov/foreign-trade/

The geographical breakdown of exports and imports of Japan with selected regions and countries is in Table VB-5 for Jan 2015. The share of Asia in Japan’s trade is close to one-half for 53.9 percent of exports and 48.7 percent of imports. Within Asia, exports to China are 17.0 percent of total exports and imports from China 24.3 percent of total imports. While exports to China increased 20.8 percent in the 12 months ending in Jan 2015, imports from China decreased 6.9 percent. The largest export market for Japan in Jan 2015 is the US with share of 19.4 percent of total exports, which is close to that of China, and share of imports from the US of 8.8 percent in total imports. Japan’s exports to the US increased 16.5 percent in the 12 months ending in Jan 2015 and imports from the US decreased 1.4 percent. Western Europe has share of 10.9 percent in Japan’s exports and of 10.1 percent in imports. Rates of growth of exports of Japan in Jan 2015 are 16.5 percent for exports to the US, 6.6 percent for exports to Brazil and 0.4 percent for exports to Germany. Comparisons relative to 2011 may have some bias because of the effects of the Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. Deceleration of growth in China and the US and threat of recession in Europe can reduce world trade and economic activity. Growth rates of imports in the 12 months ending in Jan 2015 are mixed. Imports from Asia decreased 3.0 percent in the 12 months ending in Jan 2015 while imports from China decreased 3.0 percent. Data are in millions of yen, which may have effects of recent depreciation of the yen relative to the United States dollar (USD).

Table VB-5, Japan, Value and 12-Month Percentage Changes of Exports and Imports by Regions and Countries, ∆% and Millions of Yen

Jan 2015	Exports Millions Yen	12 months ∆%	Imports Millions Yen	12 months ∆%
Total	6,144,713	17.0	7,322,176	-9.0
Asia	3,314,119 % Total 53.9	22.7	3,562,992 % Total 48.7	-3.0
China	1,041,905 % Total 17.0	20.8	1,778,299 % Total 24.3	-6.9
USA	1,192,663 % Total 19.4	16.5	647,255 % Total 8.8	-1.4
Canada	78,303	20.8	93,241	5.2
Brazil	40,584	6.6	86,272	-14.3
Mexico	87,868	21.2	38,506	7.0
Western Europe	671,916 % Total 10.9	8.2	741,708 % Total 10.1	-3.3
Germany	160,392	0.4	208,587	-8.8
France	48,630	-0.4	98,481	-0.5
UK	115,715	31.7	59,238	10.2
Middle East	216,735	6.1	1,022,772	-38.3
Australia	115,777	5.1	467,520	-1.9

Source: Japan, Ministry of Finance http://www.customs.go.jp/toukei/info/index_e.htm

World trade projections of the IMF are in Table V-6. There is increasing growth of the volume of world trade of goods and services from 3.0 percent in 2013 to 5.0 percent in 2015 and 5.6 percent on average from 2016 to 2019. World trade would be slower for advanced economies while emerging and developing economies (EMDE) experience faster growth. World economic slowdown would be more challenging with lower growth of world trade.

Table V-6, IMF, Projections of World Trade, USD Billions, USD/Barrel and Annual ∆%

	2013	2014	2015	Average ∆% 2016-2019
World Trade Volume (Goods and Services)	3.0	3.8	5.0	5.6
Exports Goods & Services	3.2	3.7	5.0	5.5
Imports Goods & Services	2.8	3.9	5.0	5.6
World Trade Value of Exports Goods & Services USD Billion	23,114	23,928	24,948	Average ∆% 2006-2015 20,259
Value of Exports of Goods USD Billion	18,671	19,299	20,107	Average ∆% 2006-2015 16,312
Average Oil Price USD/Barrel	104.07	102.76	99.36	Average ∆% 2006-2015 88.85
Average Annual ∆% Export Unit Value of Manufactures	-1.1	-0.2	-0.5	Average ∆% 2006-2015 -0.6
Exports of Goods & Services	2013	2014	2015	Average ∆% 2016-2019
Euro Area	1.8	3.5	4.3	4.7
EMDE	4.4	3.9	5.8	6.1
G7	1.8	2.9	4.2	4.9
Imports Goods & Services
Euro Area	0.5	3.4	3.9	4.7
EMDE	5.3	4.4	6.1	6.3
G7	1.2	3.6	4.1	4.9
Terms of Trade of Goods & Services
Euro Area	0.8	-0.4	-0.3	-0.1
EMDE	-0.2	-0.02	-0.6	-0.4
G7	0.8	0.7	-0.2	0.0
Terms of Trade of Goods
Euro Area	1.2	0.03	-0.02	-0.2
EMDE	-0.2	0.2	-0.4	-0.3
G7	0.9	0.3	-0.1	-0.1

Notes: Commodity Price Index includes Fuel and Non-fuel Prices; Commodity Industrial Inputs Price includes agricultural raw materials and metal prices; Oil price is average of WTI, Brent and Dubai

Source: International Monetary Fund World Economic Outlook databank

http://www.imf.org/external/ns/cs.aspx?id=28

The JP Morgan Global All-Industry Output Index of the JP Morgan Manufacturing and Services PMI^™, produced by JP Morgan and Markit in association with ISM and IFPSM, with high association with world GDP, increased to 52.8 in Jan from 52.4 in Dec, indicating expansion at slightly higher rate (http://www.markiteconomics.com/Survey/PressRelease.mvc/aa9e75bbcfac4fea8622b22632b5d42c). This index has remained above the contraction territory of 50.0 during 66 consecutive months. The employment index increased from 51.1 in Dec to 51.6 in Jan with input prices rising at slower rate, new orders increasing at slower rate and output increasing at faster rate (http://www.markiteconomics.com/Survey/PressRelease.mvc/aa9e75bbcfac4fea8622b22632b5d42c). David Hensley, Director of Global Economic Coordination at JP Morgan, finds moderate world economic growth (http://www.markiteconomics.com/Survey/PressRelease.mvc/aa9e75bbcfac4fea8622b22632b5d42c). The JP Morgan Global Manufacturing PMI^™, produced by JP Morgan and Markit in association with ISM and IFPSM, increased to 51.7 in Jan from 51.5 in Dec (http://www.markiteconomics.com/Survey/PressRelease.mvc/52b184024a1446779fe747f37d5df0ef). New export orders expanded for the eighteenth consecutive month. David Hensley, Director of Global Economics Coordination at JP Morgan Chase, finds continuing growth in global manufacturing with output increasing at around annual 3.5 percent (http://www.markiteconomics.com/Survey/PressRelease.mvc/52b184024a1446779fe747f37d5df0ef). The HSBC Brazil Composite Output Index, compiled by Markit, was unchanged from 49.2 in Dec to 49.2 in Jan, indicating moderate contraction in activity of Brazil’s private sector (http://www.markiteconomics.com/Survey/PressRelease.mvc/480418ba2f0d48e0a716f5737527d8d8). The HSBC Brazil Services Business Activity index, compiled by Markit, decreased from 49.1 in Dec to 48.4 in Jan, indicating marginally contracting services activity (http://www.markiteconomics.com/Survey/PressRelease.mvc/480418ba2f0d48e0a716f5737527d8d8). André Loes, Chief Economist, Brazil, at HSBC, finds faster pace of contraction (http://www.markiteconomics.com/Survey/PressRelease.mvc/480418ba2f0d48e0a716f5737527d8d8). The HSBC Brazil Purchasing Managers’ Index^TM (PMI^™) increased from 50.2 in Dec to 50.7 in Jan, indicating moderate improvement in manufacturing (http://www.markiteconomics.com/Survey/PressRelease.mvc/76ee5ab696c44271ac7eaa6e6da02cea). André Loes, Chief Economist, Brazil at HSBC, finds increasing output and cost-push pressures perhaps because of currency depreciation (http://www.markiteconomics.com/Survey/PressRelease.mvc/76ee5ab696c44271ac7eaa6e6da02cea).

VA United States. The Markit Flash US Manufacturing Purchasing Managers’ Index^™ (PMI^™) seasonally adjusted increased to 54.3 in Feb from 53.9 in Jan (http://www.markiteconomics.com/Survey/PressRelease.mvc/76d54ef7fac944e6a41abf20258b097f). New export orders softened. Chris Williamson, Chief Economist at Markit, finds that manufacturing provides strong contribution to economic growth (http://www.markiteconomics.com/Survey/PressRelease.mvc/76d54ef7fac944e6a41abf20258b097f). The Markit Flash US Services PMI™ Business Activity Index increased from 53.3 in Dec to 54.0 in Jan (http://www.markiteconomics.com/Survey/PressRelease.mvc/3b941f12d3724e4cb923968e1f814a36). The Markit Flash US Composite PMI™ Output Index in from 53.5 in Dec to 54.2 in Jan. Chris Williamson, Chief Economist at Markit, finds that the surveys are consistent with growth of GDP around 2.5 percent (http://www.markiteconomics.com/Survey/PressRelease.mvc/3b941f12d3724e4cb923968e1f814a36). The Markit US Composite PMI™ Output Index of Manufacturing and Services increased to 54.4 in Jan from 53.5 in Dec (http://www.markiteconomics.com/Survey/PressRelease.mvc/4df1e15f72dc47a89ba23d0f062c1360). The Markit US Services PMI™ Business Activity Index increased from 53.3 in Dec to 54.2 in Jan (http://www.markiteconomics.com/Survey/PressRelease.mvc/4df1e15f72dc47a89ba23d0f062c1360). Chris Williamson, Chief Economist at Markit, finds the indexes consistent with US growth at around 2.0 percent annual in IQ2015 (http://www.markiteconomics.com/Survey/PressRelease.mvc/4df1e15f72dc47a89ba23d0f062c1360). The Markit US Manufacturing Purchasing Managers’ Index^™ (PMI^™) did not change to 53.9 in Jan from 53.9 in Dec, which indicates expansion at the same rate (http://www.markiteconomics.com/Survey/PressRelease.mvc/dce95357995b45edbcf2bd17561b8f94). New foreign orders expanded at moderate rate. Chris Williamson, Chief Economist at Markit, finds that the index suggests slowing but strong manufacturing with GDP growth possibly lower in IQ2015 than 2.6 percent SAAR in IVQ2014 (http://www.markiteconomics.com/Survey/PressRelease.mvc/dce95357995b45edbcf2bd17561b8f94). The purchasing managers’ index (PMI) of the Institute for Supply Management (ISM) Report on Business^® decreased 1.6 percentage points from 55.1 in Dec to 53.5 in Jan, which indicates growth at slower rate (http://www.ism.ws/ISMReport/MfgROB.cfm?navItemNumber=12942). The index of new orders decreased 4.9 percentage points from 57.8 in Dec to 52.9 in Jan. The index of new export orders decreased 2.5 percentage points from 52.0 in Dec to 49.5 in Jan, contracting at moderate rate. The Non-Manufacturing ISM Report on Business^® PMI increased 0.2 percentage points from 56.5 in Dec to 56.7 in Jan, indicating growth of business activity/production during 66 consecutive months, while the index of new orders increased 0.3 percentage points from 59.2 in Dec to 59.5 in Jan (http://www.ism.ws/ISMReport/NonMfgROB.cfm?navItemNumber=28744). Table USA provides the country economic indicators for the US.

Table USA, US Economic Indicators

Consumer Price Index	Jan 12 months NSA ∆%: -0.1; ex food and energy ∆%: 1.6 Jan month SA ∆%: -0.7; ex food and energy ∆%: 0.2 Blog 3/1/15
Producer Price Index	Finished Goods Jan 12-month NSA ∆%: -3.1; ex food and energy ∆% 1.5 Jan month SA ∆% = -2.1; ex food and energy ∆%: 0.2 Final Demand Jan 12-month NSA ∆%: 0.0; ex food and energy ∆% 1.6 Jan month SA ∆% = -0.8; ex food and energy ∆%: -0.1 Blog 2/22/15 3/1/15
PCE Inflation	Dec 12-month NSA ∆%: headline 0.7; ex food and energy ∆% 1.3 Blog 2/8/15
Employment Situation	Household Survey: Jan Unemployment Rate SA 5.7% Blog calculation People in Job Stress Jan: 27.9 million NSA, 17.0% of Labor Force Establishment Survey: Jan Nonfarm Jobs +257,000; Private +267,000 jobs created  Dec 12-month Average Hourly Earnings Inflation Adjusted ∆%: 0.5 Blog 2/8/15
Nonfarm Hiring	Nonfarm Hiring fell from 63.3 million in 2006 to 54.2 million in 2013 or by 9.1 million Private-Sector Hiring Dec 2014 3.667 million lower by 0.101 million than 3.768 million in Dec 2006 Blog 2/15/15
GDP Growth	BEA Revised National Income Accounts IQ2012/IQ2011 ∆%: 2.6 IIQ2012/IIQ2011 2.3 IIIQ2012/IIIQ2011 2.7 IVQ2012/IVQ2011 1.6 IQ2013/IQ2012 1.7 IIQ2013/IIQ2012 1.8 IIIQ2013/IIIQ2012 2.3 IVQ2013/IVQ2012 3.1 IQ2014/IQ2013 1.9 IIQ2014/IIQ2013 2.6 IIIQ2014/IIIQ2013 2.7 IVQ2014/IVQ2013 2.4 IQ2012 SAAR 2.3 IIQ2012 SAAR 1.6 IIIQ2012 SAAR 2.5 IVQ2012 SAAR 0.1 IQ2013 SAAR 2.7 IIQ2013 SAAR 1.8 IIIQ2013 SAAR 4.5 IVQ2013 SAAR 3.5 IQ2014 SAAR -2.1 IIQ2014 SAAR 4.6 IIIQ2014 SAAR 5.0 IVQ2014 SAAR 2.2 Blog 3/1/15
Real Private Fixed Investment	SAAR IVQ2014 4.5 ∆% IVQ2007 to IVQ2014: 3.3% Blog 3/1/15
Corporate Profits	IIIQ2014 SAAR: Corporate Profits 3.1; Undistributed Profits 12.4 Blog 12/28/14
Personal Income and Consumption	Dec month ∆% SA Real Disposable Personal Income (RDPI) SA ∆% 0.5 Real Personal Consumption Expenditures (RPCE): -0.1 12-month Dec NSA ∆%: RDPI: 3.7; RPCE ∆%: 2.8 Blog 2/8/15
Quarterly Services Report	IIIQ14/IIIQ13 NSA ∆%: Information 6.6 Financial & Insurance 4.8 Blog 12/14/14
Employment Cost Index	Compensation Private IVQ2014 SA ∆%: 0.6 Dec 12 months ∆%: 2.3 Blog 2/1/15
Industrial Production	Jan month SA ∆%: 0.2 Jan 12 months SA ∆%: 4.8 Manufacturing Jan SA 0.2 ∆% Jan 12 months SA ∆% 5.6, NSA 5.5 Capacity Utilization: 79.4 Blog 2/22/15
Productivity and Costs	Nonfarm Business Productivity IVQ2014∆% SAAE -1.8; IVQ2014/IVQ2013 ∆% 0.0; Unit Labor Costs SAAE IVQ2014 ∆% 2.7; IVQ2014/IVQ2013 ∆%: 1.9 Blog 2/8/15
New York Fed Manufacturing Index	General Business Conditions From Jan 9.95 to Feb 7.78 New Orders: From Jan 6.09 to Feb 1.22 Blog 2/22/15
Philadelphia Fed Business Outlook Index	General Index from Jan 6.3 to Feb 5.2 New Orders from Jan 8.5 to Feb 5.4 Blog 2/22/15
Manufacturing Shipments and Orders	New Orders SA Dec ∆% -3.4 Ex Transport -2.3 Jan-Dec NSA New Orders ∆% 2.8 Ex transport 1.9 Blog 2/8/15
Durable Goods	Jan New Orders SA ∆%: minus 2.8; ex transport ∆%: minus 0.3 Jan 15/Jan 14 New Orders NSA ∆%: 1.6; ex transport ∆% 1.5 Blog 3/1/15
Sales of New Motor Vehicles	Jan 2015 1,151.123; Jan 2014 1,012,582. Jan 15 SAAR 16.66 million, Dec 14 SAAR 16.92 million, Jan 2014 SAAR 15.29 million Blog 2/8/15
Sales of Merchant Wholesalers	Jan-Dec 2014/Jan-Dec 2013 NSA ∆%: Total 5.1; Durable Goods: 5.8; Nondurable Goods: 4.5 Blog 2/15/15
Sales and Inventories of Manufacturers, Retailers and Merchant Wholesalers	Dec 14 12-M NSA ∆%: Sales Total Business 2.8; Manufacturers 0.1 Retailers 4.3; Merchant Wholesalers 4.3 Blog 2/15/15
Sales for Retail and Food Services	Jan 2015/Jan 2014 ∆%: Retail and Food Services 2.8; Retail ∆% 1.6 Blog 2/15/15
Value of Construction Put in Place	Dec SAAR month SA ∆%: minus 0.4 Dec 12-month NSA: 3.3 Blog 2/8/15
Case-Shiller Home Prices	Dec 2014/ Dec 2013 ∆% NSA: 10 Cities 4.3; 20 Cities: 4.5; National: 4.6 ∆% Dec SA: 10 Cities 0.8 ; 20 Cities: 0.9 Blog 3/1/15
FHFA House Price Index Purchases Only	Dec SA ∆% 0.8; 12 month NSA ∆%: 5.5 Blog 3/1/15
New House Sales	Jan 2014 month SAAR ∆%: minus 0.2 Jan 2014/Jan 2013 NSA ∆%: 9.1 Blog 3/1/15
Housing Starts and Permits	Jan Starts month SA ∆% -2.0; Permits ∆%: -0.7 Jan 2015/Jan 2014 NSA ∆% Starts 18.3; Permits  ∆% 4.2 Blog 2/22/15
Trade Balance	Balance Dec SA -$46,557 million versus Nov -$39,751 million Exports Dec SA ∆%: 0.8 Imports Dec SA ∆%: 2.2 Goods Exports Jan-Dec 2014/Jan-Dec 2013 NSA ∆%: 2.8 Goods Imports Jan-Dec 2014/Jan-Dec 2012 NSA ∆%: 3.4 Blog 2/8/15
Export and Import Prices	Jan 12-month NSA ∆%: Imports -8.0; Exports -5.4 Blog 2/15/15
Consumer Credit	Dec ∆% annual rate: Total 5.4; Revolving 7.9; Nonrevolving 4.5 Blog 2/15/15
Net Foreign Purchases of Long-term Treasury Securities	Dec Net Foreign Purchases of Long-term US Securities: $35.4 billion Major Holders of Treasury Securities: China $1244 billion; Japan $1231 billion; Total Foreign US Treasury Holdings Jan $6154 billion Blog 2/22/15
Treasury Budget	Fiscal Year 2015/2014 ∆% Jan: Receipts 8.7; Outlays 8.3; Individual Income Taxes 8.2 Deficit Fiscal Year 2011 $1,300 billion Deficit Fiscal Year 2012 $1,087 billion Deficit Fiscal Year 2013 $680 billion Deficit Fiscal Year 2014 $483 billion Blog 2/15/2015
CBO Budget and Economic Outlook	2012 Deficit $1087 B 6.8% GDP Debt $11,281 B 70.4% GDP 2013 Deficit $680 B, 4.1% GDP Debt $11,983 B 72.3% GDP 2014 Deficit $483 B 2.8% GDP Debt $12,779 B 74.1% GDP 2025 Deficit $1,088B, 4.0% GDP Debt $21,605B 78.7% GDP 2039: Long-term Debt/GDP 106% Blog 8/26/12 11/18/12 2/10/13 9/22/13 2/16/14 8/24/14 9/14/14 3/1/15
Commercial Banks Assets and Liabilities	Dec 2014 SAAR ∆%: Securities 24.2 Loans 7.1 Cash Assets -52.4 Deposits 7.6 Blog 1/25/15
Flow of Funds Net Worth of Families and Nonprofits	IIIQ2014 ∆ since 2007 Assets +$14,260.8 BN Nonfinancial $477.8 BN Real estate -$1,215.2 BN Financial +13,783.0 BN Net Worth +$14,595.3 BN Blog 12/28/14
Current Account Balance of Payments	IIIQ2014 -202,280 MM % GDP 2.3 Blog 12/21/14
Collapse of United States Dynamism of Income Growth and Employment Creation	Blog 1/25/15

Links to blog comments in Table USA:

2/22/15 http://cmpassocregulationblog.blogspot.com/2015/02/world-financial-turbulence-squeeze-of.html

2/15/15 http://cmpassocregulationblog.blogspot.com/2015/02/g20-monetary-policy-recovery-without.html

2/8/15 http://cmpassocregulationblog.blogspot.com/2015/02/job-creation-and-monetary-policy-twenty.html

2/1/15 http://cmpassocregulationblog.blogspot.com/2015/02/financial-and-international.html

1/25/15 http://cmpassocregulationblog.blogspot.com/2015/01/competitive-currency-conflicts-world.html

12/28/14 http://cmpassocregulationblog.blogspot.com/2014/12/valuations-of-risk-financial-assets.html

12/21/14 http://cmpassocregulationblog.blogspot.com/2014/12/patience-on-interest-rate-increases.html

12/14/14 http://cmpassocregulationblog.blogspot.com/2014/12/global-financial-and-economic-risk.html

12/7/14 http://cmpassocregulationblog.blogspot.com/2014/12/financial-risks-twenty-six-million.html

9/14/14 http://cmpassocregulationblog.blogspot.com/2014/09/geopolitics-monetary-policy-and.html

8/24/14 http://cmpassocregulationblog.blogspot.com/2014/08/monetary-policy-world-inflation-waves.html

8/3/14 http://cmpassocregulationblog.blogspot.com/2014/08/fluctuating-financial-valuations.html

2/16/14 http://cmpassocregulationblog.blogspot.com/2014/02/theory-and-reality-of-cyclical-slow.html

9/22/13 http://cmpassocregulationblog.blogspot.com/2013/09/duration-dumping-and-peaking-valuations.html

2/10/13 http://cmpassocregulationblog.blogspot.com/2013/02/united-states-unsustainable-fiscal.html

Manufacturers’ shipments of durable goods decreased 1.1 percent in Jan 2015, increasing 1.5 percent in Dec 2014 and decreasing 0.7 percent in Nov 2014. New orders increased 2.8 percent in Jan 2015 after decreasing 3.7 percent in Dec 2014 and decreasing 2.2 percent in Nov 2014, as shown in Table VA-1. These data are very volatile. Volatility is illustrated by decrease of 12.9 percent in Nov 2012 after increase of orders for nondefense aircraft of 2642.2 percent in Sep 2012 after decrease of 97.2 percent in Aug and increases of 51.1 percent in Jul 2012 and 32.5 percent in Jun 2012. Nondefense aircraft new orders increased 128.5 percent in Jan 2015 after decreasing 58.3 percent in Dec 2015 and decreasing 11.0 percent in Nov 2014. New orders excluding transportation equipment increased 0.3 percent in Jan 2015, decreasing 0.9 percent in Dec 2014 and decreasing 1.3 percent in Nov 2014. Capital goods new orders, indicating investment, increased 8.0 percent in Jan 2015, decreasing 10.5 percent in Dec 2014 and decreasing 2.7 percent in Nov 2014. New orders of nondefense capital goods increased 9.5 percent in Jan 2015, after decreasing 10.3 percent in Dec 2014 and decreasing 1.5 percent in Nov 2014. Capital goods orders excluding volatile aircraft increased 0.6 percent in Jan 2015, decreasing 0.7 percent in Dec 2014 and decreasing 0.5 percent in Nov 2014.

Table VA-1, US, Durable Goods Value of Manufacturers’ Shipments and New Orders, SA, Month ∆%

	Jan 2015 ∆%	Dec 2014 ∆%	Nov 2014  ∆%
Total
S	-1.1	1.5	-0.7
NO	2.8	-3.7	-2.2
Excluding Transport
S	-0.8	0.4	-0.6
NO	0.3	-0.9	-1.3
Excluding Defense
S	-0.6	1.3	-0.8
NO	-3.0	-3.3	-1.4
Machinery
S	-1.5	-1.0	-0.8
NO	1.9	-3.5	-0.8
Computers & Electronic Products
S	-0.7	-0.3	-0.3
NO	1.0	-1.8	-0.6
Computers
S	3.2	-1.7	-1.4
NO	7.4	-7.8	-0.9
Transport Equipment
S	-1.7	3.9	-1.0
NO	9.1	-10.1	-4.0
Motor Vehicles
S	-3.0	3.3	0.2
NO	-2.9	2.6	0.6
Nondefense Aircraft
S	9.2	3.2	-4.6
NO	128.5	-58.3	-11.0
Capital Goods
S	-0.5	1.2	-0.9
NO	8.0	-10.5	-2.7
Nondefense Capital Goods
S	1.0	0.7	-1.2
NO	9.5	-10.3	-1.5
Capital Goods ex Aircraft
S	-0.3	0.3	-0.5
NO	0.6	-0.7	-0.5

Note: Mfg: manufacturing; S: shipments; NO: new orders; Transport: transportation

Source: US Census Bureau

http://www.census.gov/manufacturing/m3/

Chart VA-1 of the US Census Bureau provides new orders of durable goods seasonally adjusted since Jan 1992. New orders fell sharply during the global recession. New orders recovered at faster rates and then flattened together with the rest of the economy after 2012. There are also downward effects of lower inflation because data are nominal without adjustment for inflation.

Chart VA-1, US, Durable Goods New orders, SA

Source: US Census Bureau

http://www.census.gov/manufacturing/m3/

Chart VA-2 provides monthly changes in durable goods new orders. There is significant volatility in these data, preventing clear identification of trends.

Chart VA-2, US, Manufacturers’ Durable Goods New Orders 2014-2015

Source: US Census Bureau

http://www.census.gov/briefrm/esbr/www/esbr021.html

Additional perspective on manufacturers’ shipments and new orders of durable goods is in Table VA-2. Values are cumulative millions of dollars in Jan 2015 not seasonally adjusted (NSA) and without adjustment for inflation. Shipments of durable goods of all manufacturing industries in Jan 2015 total $217.4 billion and new orders total $209.8 billion, growing respectively by 3.1 percent and 1.6 percent relative to the same period in 2014. Excluding transportation equipment, shipments grew 1.2 percent and new orders increased 1.5 percent. Excluding defense, shipments grew 3.5 percent and new orders grew 1.4 percent. Important information not in Table VA-2 is the large share of nondurable goods. Capital goods have relatively high value of $75.1 billion for shipments, growing 4.1 percent, and new orders $74.4 billion, increasing 2.1 percent. Excluding aircraft, capital goods shipments reached $61.0 billion, growing by 3.6 percent, and new orders $64.1 billion, increasing 0.3 percent. Data weakened in 2013-2014 with effects of lower inflation on nominal values with recovery later in the year.

Table VA-2, US, Value of Manufacturers’ Shipments and New Orders of Durable Goods, NSA, Millions of Dollars 

Jan 2015	Shipments	∆% 2015/ 2014	New Orders	∆% 2015/  2014
Total	217,427	3.1	209,812	1.6
Excluding Transport	155,095	2.1	151,333	1.5
Excluding Defense	208,234	3.5	202,167	1.4
Machinery	30,802	0.7	32,554	-6.7
Computers & Electronic Products	25,817	-3.5	18,565	3.6
Computers & Related Products	1,370	-19.5	1,413	-6.8
Transport Equipment	62,332	5.8	58,479	2.1
Motor Vehicles	42,823	5.2	43,008	5.1
Nondefense Aircraft	10,186	14.1	6,901	-20.6
Capital Goods	75,072	4.1	72,417	-2.1
Nondefense Capital Goods	67,605	5.3	66,980	-2.1
Capital Goods ex Aircraft	61,020	3.6	64,099	0.3

Note: Transport: transportation

Source: US Census Bureau

http://www.census.gov/manufacturing/m3/

Chart VA-3 of the US Census Bureau provides new orders of durable goods not seasonally adjusted since Jan 1992. New orders are oscillating around the highest value before the global recession, which could be lower in real terms because of continuing inflation.

Chart VA-3, US, Durable Goods New orders, NSA

Source: US Census Bureau

http://www.census.gov/manufacturing/m3/

Chart VA-4 of the Board of Governors of the Federal Reserve System shows that output of durable manufacturing accelerated in the 1980s and 1990s with slower growth in the 2000s perhaps because processes matured. Growth was robust after the major drop during the global recession but appears to vacillate in the final segment.

Chart VA-4, US, Output of Durable Manufacturing, 1972-2015

Source: Board of Governors of the Federal Reserve System

http://www.federalreserve.gov/releases/g17/Current/default.htm

Manufacturing jobs not seasonally adjusted increased 232,000 from Jan 2014 to
Jan 2015 or at the average monthly rate of 19,333. There are effects of the weaker economy and international trade together with the yearly adjustment of labor statistics. Industrial production decreased 0.1 percent in Dec 2014 and increased 1.3 percent in Nov 2014 after changing 0.0 percent in Oct 2014, with all data seasonally adjusted. The Federal Reserve completed its annual revision of industrial production and capacity utilization on Mar 28, 2014 (http://www.federalreserve.gov/releases/g17/revisions/Current/DefaultRev.htm). The report of the Board of Governors of the Federal Reserve System states (http://www.federalreserve.gov/releases/g17/Current/default.htm):

“Industrial production increased 0.2 percent in January after decreasing 0.3 percent in December. The rates of change in output for September through December are all slightly lower than previously published; even so, production is estimated to have advanced at an annual rate of 4.3 percent in the fourth quarter of last year. In January, manufacturing output moved up 0.2 percent and was 5.6 percent above its year-earlier level. The index for mining decreased 1.0 percent, with the decline more than accounted for by a substantial drop in the index for oil and gas well drilling and related support activities. The output of utilities increased 2.3 percent. At 106.2 percent of its 2007 average, total industrial production in January was 4.8 percent above its level of a year earlier. Capacity utilization for the industrial sector was unchanged in January at 79.4 percent, a rate that is 0.7 percentage point below its long-run (1972–2014) average.”

In the six months ending in Jan 2015, United States national industrial production accumulated increase of 1.6 percent at the annual equivalent rate of 3.2 percent, which is lower than growth of 4.8 percent in the 12 months ending in Jan 2015. Excluding growth of 1.1 percent in Nov 2014, growth in the remaining five months from Aug 2014 to Jan 2015 accumulated to 0.5 percent or 1.2 percent annual equivalent. Industrial production declined in two of the past six months. Industrial production expanded at annual equivalent 4.1 percent in the most recent quarter from Nov 2014 to Jan 2015 and at 2.4 percent in the prior quarter Aug to Oct 2014. Business equipment accumulated growth of 1.4 percent in the six months from Aug 2014 to Jan 2015 at the annual equivalent rate of 2.8 percent, which is lower than growth of 7.3 percent in the 12 months ending in Jan 2015. The Fed analyzes capacity utilization of total industry in its report (http://www.federalreserve.gov/releases/g17/Current/default.htm): “Capacity utilization for the industrial sector was unchanged in January at 79.4 percent, a rate that is 0.7 percentage point below its long-run (1972–2014) average.” United States industry apparently decelerated to a lower growth rate followed by possible acceleration and oscillating growth in past months.

Manufacturing fell 21.9 from the peak in Jun 2007 to the trough in Apr 2009 and increased by 25.2 percent from the trough in Apr 2009 to Dec 2014. Manufacturing grew 24.2 percent from the trough in Apr 2009 to Jan 2015. Manufacturing output in Jan 2015 is 3.1 percent below the peak in Jun 2007. Growth at trend in the entire cycle from IVQ2007 to IVQ2014 would have accumulated to 23.0 percent. GDP in IVQ2014 would be $18,438.0 billion (in constant dollars of 2009) if the US had grown at trend, which is higher by $2,144.3 billion than actual $16,293.7 billion. There are about two trillion dollars of GDP less than at trend, explaining the 28.3 million unemployed or underemployed equivalent to actual unemployment of 17.1 percent of the effective labor force (http://cmpassocregulationblog.blogspot.com/2015/02/job-creation-and-monetary-policy-twenty.html and earlier http://cmpassocregulationblog.blogspot.com/2015/01/fluctuating-valuations-of-risk.html and earlier http://cmpassocregulationblog.blogspot.com/2014/12/financial-risks-twenty-six-million.html). US GDP in IVQ2014 is 11.6 percent lower than at trend. US GDP grew from $14,991.8 billion in IVQ2007 in constant dollars to $16,311.6 billion in IVQ2014 or 8.8 percent at the average annual equivalent rate of 1.2 percent. Cochrane (2014Jul2) estimates US GDP at more than 10 percent below trend. The US missed the opportunity to grow at higher rates during the expansion and it is difficult to catch up because growth rates in the final periods of expansions tend to decline. The US missed the opportunity for recovery of output and employment always afforded in the first four quarters of expansion from recessions. Zero interest rates and quantitative easing were not required or present in successful cyclical expansions and in secular economic growth at 3.0 percent per year and 2.0 percent per capita as measured by Lucas (2011May). There is cyclical uncommonly slow growth in the US instead of allegations of secular stagnation. There is similar behavior in manufacturing. There is classic research on analyzing deviations of output from trend (see for example Schumpeter 1939, Hicks 1950, Lucas 1975, Sargent and Sims 1977). The long-term trend is growth at average 3.3 percent per year from Jan 1919 to Jan 2015. Growth at 3.3 percent per year would raise the NSA index of manufacturing output from 99.2392 in Dec 2007 to 124.8993 in Jan 2015. The actual index NSA in Jan 2015 is 99.8883, which is 20.0 percent below trend. Manufacturing output grew at average 2.4 percent between Dec 1986 and Dec 2014, raising the index at trend to 117.3927 in Jan 2015. The output of manufacturing at 99.8883 in Jan 2015 is 14.9 percent below trend under this alternative calculation.

Table I-13 provides national income by industry without capital consumption adjustment (WCCA). “Private industries” or economic activities have share of 87.4 percent in IIIQ2014. Most of US national income is in the form of services. In Jan 2015, there were 138.728 million nonfarm jobs NSA in the US, according to estimates of the establishment survey of the Bureau of Labor Statistics (BLS) (http://www.bls.gov/news.release/empsit.nr0.htm Table B-1). Total private jobs of 116.976 million NSA in Jan 2015 accounted for 84.3 percent of total nonfarm jobs of 138.728 million, of which 12.219 million, or 10.4 percent of total private jobs and 8.8 percent of total nonfarm jobs, were in manufacturing. Private service-providing jobs were 97.946 million NSA in Jan 2015, or 70.6 percent of total nonfarm jobs and 83.7 percent of total private-sector jobs. Manufacturing has share of 11.2 percent in US national income in IIIQ2014 and durable goods 6.5 percent, as shown in Table I-13. Most income in the US originates in services. Subsidies and similar measures designed to increase manufacturing jobs will not increase economic growth and employment and may actually reduce growth by diverting resources away from currently employment-creating activities because of the drain of taxation.

Table I-13, US, National Income without Capital Consumption Adjustment by Industry, Seasonally Adjusted Annual Rates, Billions of Dollars, % of Total

	SAAR IIQ2014	% Total	SAAR IIIQ2014	% Total
National Income WCCA	15,222.0	100.0	15,494.0	100.0
Domestic Industries	15,008.6	98.6	15,264.1	98.5
Private Industries	13,287.8	87.3	13,538.5	87.4
Agriculture	179.0	1.2	167.6	1.1
Mining	261.4	1.7	273.9	1.8
Utilities	215.6	1.4	221.8	1.4
Construction	670.3	4.4	681.7	4.4
Manufacturing	1712.8	11.3	1743.0	11.2
Durable Goods	975.4	6.4	1,002.2	6.5
Nondurable Goods	737.4	4.8	740.8	4.8
Wholesale Trade	917.7	6.0	944.4	6.1
Retail Trade	1048.0	6.9	1055.1	6.8
Transportation & WH	478.1	3.1	479.8	3.1
Information	580.3	3.8	574.9	3.7
Finance, Insurance, RE	2642.8	17.4	2794.1	18.0
Professional & Business Services	2064.5	13.6	2066.4	13.3
Education, Health Care	1484.3	9.8	1494.6	9.6
Arts, Entertainment	605.0	4.0	609.4	3.9
Other Services	428.0	2.8	431.9	2.8
Government	1720.8	11.3	1725.6	11.1
Rest of the World	213.5	1.4	229.9	1.5

Notes: SSAR: Seasonally-Adjusted Annual Rate; WCCA: Without Capital Consumption Adjustment by Industry; WH: Warehousing; RE, includes rental and leasing: Real Estate; Art, Entertainment includes recreation, accommodation and food services; BS: business services

Source: US Bureau of Economic Analysis

http://www.bea.gov/iTable/index_nipa.cfm

VB Japan. The GDP of Japan grew at 1.0 percent per year on average from 1991 to 2002, with the GDP implicit deflator falling at 0.8 percent per year on average. The average growth rate of Japan’s GDP was 4 percent per year on average from the middle of the 1970s to 1992 (Ito 2004). Low growth in Japan in the 1990s is commonly labeled as “the lost decade” (see Pelaez and Pelaez, The Global Recession Risk (2007), 81-115). Table VB-GDP provides yearly growth rates of Japan’s GDP from 1995 to 2014. Growth weakened from 1.9 per cent in 1995 and 2.6 percent in 1996 to contractions of 2.0 percent in 1998 and 0.2 percent in 1999. Growth rates were below 2 percent with exception of 2.3 percent in 2000, 2.4 percent in 2004 and 2.2 percent in 2007. Japan’s GDP contracted sharply by 1.0 percent in 2008 and 5.5 percent in 2009. As in most advanced economies, growth was robust at 4.7 percent in 2010 but mediocre at minus 0.5 percent in 2011 because of the tsunami and 1.8 percent in 2012. Japan’s GDP grew 1.6 percent in 2013 and stagnated in 2014. There is classic research on analyzing deviations of output from trend (see for example Schumpeter 1939, Hicks 1950, Lucas 1975, Sargent and Sims 1977). Japan’s real GDP in calendar year 2014 is 0.7 percent higher than in calendar year 2007 (http://www.esri.cao.go.jp/index-e.html).

Table VB-GDP, Japan, Yearly Percentage Change of GDP  ∆%

Calendar Year	∆%
1995	1.9
1996	2.6
1997	1.6
1998	-2.0
1999	-0.2
2000	2.3
2001	0.4
2002	0.3
2003	1.7
2004	2.4
2005	1.3
2006	1.7
2007	2.2
2008	-1.0
2009	-5.5
2010	4.7
2011	-0.5
2012	1.8
2013	1.6
2014	0.0

Source: Source: Japan Economic and Social Research Institute, Cabinet Office

http://www.esri.cao.go.jp/index-e.html

http://www.esri.cao.go.jp/en/sna/sokuhou/sokuhou_top.html

Table VB-BOJF provides the forecasts of economic activity and inflation in Japan by the majority of members of the Policy Board of the Bank of Japan, which is part of their Outlook for Economic Activity and Prices (https://www.boj.or.jp/en/announcements/release_2015/k150121a.pdf) with changes on Jul 21, 2015 (https://www.boj.or.jp/en/announcements/release_2015/k150121a.pdf). For fiscal 2014, the forecast is of growth of GDP between minus 0.7 to minus 0.3 percent, with the all items CPI less fresh food 2.9 to 3.3 percent (https://www.boj.or.jp/en/announcements/release_2015/k150121a.pdf). The critical difference is forecast of the CPI excluding fresh food of 0.3 to 1.4 percent in 2015 and 0.9 to 2.3 percent in 2016 (https://www.boj.or.jp/en/announcements/release_2015/k150121a.pdf). Consumer price inflation in Japan excluding fresh food was minus 0.2 percent in Dec 2014 and 2.5 percent in 12 months (http://www.stat.go.jp/english/data/cpi/1581.htm), significantly because of the increase of the tax on value added of consumption in Apr 2014. The new monetary policy of the Bank of Japan aims to increase inflation to 2 percent. These forecasts are biannual in Apr and Oct. The Cabinet Office, Ministry of Finance and Bank of Japan released on Jan 22, 2013, a “Joint Statement of the Government and the Bank of Japan on Overcoming Deflation and Achieving Sustainable Economic Growth” (http://www.boj.or.jp/en/announcements/release_2013/k130122c.pdf) with the important change of increasing the inflation target of monetary policy from 1 percent to 2 percent:

“The Bank of Japan conducts monetary policy based on the principle that the policy shall be aimed at achieving price stability, thereby contributing to the sound development of the national economy, and is responsible for maintaining financial system stability. The Bank aims to achieve price stability on a sustainable basis, given that there are various factors that affect prices in the short run.

The Bank recognizes that the inflation rate consistent with price stability on a sustainable basis will rise as efforts by a wide range of entities toward strengthening competitiveness and growth potential of Japan's economy make progress. Based on this recognition, the Bank sets the price stability target at 2 percent in terms of the year-on-year rate of change in the consumer price index.

Under the price stability target specified above, the Bank will pursue monetary easing and aim to achieve this target at the earliest possible time. Taking into consideration that it will take considerable time before the effects of monetary policy permeate the economy, the Bank will ascertain whether there is any significant risk to the sustainability of economic growth, including from the accumulation of financial imbalances.”

The Bank of Japan also provided explicit analysis of its view on price stability in a “Background note regarding the Bank’s thinking on price stability” (http://www.boj.or.jp/en/announcements/release_2013/data/rel130123a1.pdf http://www.boj.or.jp/en/announcements/release_2013/rel130123a.htm/). The Bank of Japan also amended “Principal terms and conditions for the Asset Purchase Program” (http://www.boj.or.jp/en/announcements/release_2013/rel130122a.pdf): “Asset purchases and loan provision shall be conducted up to the maximum outstanding amounts by the end of 2013. From January 2014, the Bank shall purchase financial assets and provide loans every month, the amount of which shall be determined pursuant to the relevant rules of the Bank.”

Financial markets in Japan and worldwide were shocked by new bold measures of “quantitative and qualitative monetary easing” by the Bank of Japan (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf). The objective of policy is to “achieve the price stability target of 2 percent in terms of the year-on-year rate of change in the consumer price index (CPI) at the earliest possible time, with a time horizon of about two years” (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf). The main elements of the new policy are as follows:

1. Monetary Base Control. Most central banks in the world pursue interest rates instead of monetary aggregates, injecting bank reserves to lower interest rates to desired levels. The Bank of Japan (BOJ) has shifted back to monetary aggregates, conducting money market operations with the objective of increasing base money, or monetary liabilities of the government, at the annual rate of 60 to 70 trillion yen. The BOJ estimates base money outstanding at “138 trillion yen at end-2012) and plans to increase it to “200 trillion yen at end-2012 and 270 trillion yen at end 2014” (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf).
2. Maturity Extension of Purchases of Japanese Government Bonds. Purchases of bonds will be extended even up to bonds with maturity of 40 years with the guideline of extending the average maturity of BOJ bond purchases from three to seven years. The BOJ estimates the current average maturity of Japanese government bonds (JGB) at around seven years. The BOJ plans to purchase about 7.5 trillion yen per month (http://www.boj.or.jp/en/announcements/release_2013/rel130404d.pdf). Takashi Nakamichi, Tatsuo Ito and Phred Dvorak, wiring on “Bank of Japan mounts bid for revival,” on Apr 4, 2013, published in the Wall Street Journal (http://online.wsj.com/article/SB10001424127887323646604578401633067110420.html), find that the limit of maturities of three years on purchases of JGBs was designed to avoid views that the BOJ would finance uncontrolled government deficits.
3. Seigniorage. The BOJ is pursuing coordination with the government that will take measures to establish “sustainable fiscal structure with a view to ensuring the credibility of fiscal management” (http://www.boj.or.jp/en/announcements/release_2013/k130404a.pdf).
4. Diversification of Asset Purchases. The BOJ will engage in transactions of exchange traded funds (ETF) and real estate investment trusts (REITS) and not solely on purchases of JGBs. Purchases of ETFs will be at an annual rate of increase of one trillion yen and purchases of REITS at 30 billion yen.
5. Bank Lending Facility and Growth Supporting Funding Facility. At the meeting on Feb 18, the Bank of Japan doubled the scale of these lending facilities to prevent their expiration in the near future (http://www.boj.or.jp/en/announcements/release_2014/k140218a.pdf).

Table VB-BOJF, Bank of Japan, Forecasts of the Majority of Members of the Policy Board, % Year on Year

Fiscal Year Date of Forecast	Real GDP	CPI All Items Less Fresh Food	Excluding Effects of Consumption Tax Hikes
2013
Apr 2014	+2.2 to +2.3 [+2.2]	+0.8
Jan 2014	+2.5 to +2.9 [+2.7]	+0.7 to +0.9 [+0.7]
Oct 2013	+2.6 to +3.0 [+2.7]	+0.6 to +1.0 [+0.7]
Jul 2013	+2.5 to +3.0 [+2.8]	+0.5 to +0.8 [+0.6]
2014
Jan 2015	-0.6 to -0.4 [-0.5]	+2.9 to +3.2 [+2.9]	+0.9 to +1.2 [+0.9]
Oct 2014	+0.2 to +0.7 [+0.5]	+3.1 to +3.4 [+3.2]	+1.1 to +1.4 [+1.2]
Jul 2014	+0.6 to +1.3 [+1.0]	+3.2 to +3.5 [+3.3]	+1.2 to +1.5 [+1.3]
Apr 2014	+0.8 to +1.3 [+1.1]	+3.0 to +3.5 [+3.3]	+1.0 to +1.5 [+1.3]
Jan 2014	+0.9 to 1.5 [+1.4]	+2.9 to +3.6 [+3.3]	+0.9 to +1.6 [+1.3]
Oct 2013	+0.9 to +1.5 [+1.5]	+2.8 to +3.6 [+3.3]	+0.8 to +1.6 [+1.3]
Jul 2013	+0.8 to +1.5 [+1.3]	+2.7 to +3.6 [+3.3]	+0.7 to +1.6 [+1.3]
2015
Jan 2015	+1.8 to +2.3 [+2.1]	+0.4 to +1.3 [+1.0]	+0.4 to +1.3 [+1.0]
Oct 2014	+1.2 to +1.7 [+1.5]	+1.8 to 2.6 [+2.4]	+1.1 to +1.9 [+1.7]
Jul 2014	+1.2 to +1.6 [+1.5]	+1.9 to +2.8 [+2.6]	+1.2 to +2.1 [+1.9]
Apr 2014	+1.2 to +1.5 [+1.5]	+1.9 to +2.8 [+2.6]	+1.2 to +2.1 [+1.9]
Jan 2014	+1.2 to +1.8 [+1.5]	+1.7 to +2.9 [+2.6]	+1.0 to +2.2 [+1.9]
Oct 2013	+1.3 to +1.8 [+1.5]	+1.6 to +2.9 [+2.6]	+0.9 to +2.2 [+1.9]
Jul 2013	+1.3 to +1.9 [+1.5]	+1.6 to +2.9 [+2.6]	+0.9 to +2.2 [+1.9]
2016
Jan 2015	+1.5 to +1.7 [+1.6]	+1.5 to +2.3 [+2.2]	+1.5 to +2.3 [+2.2]
Oct 2014	+1.0 to +1.4 [+1.2]	+1.9 to 3.0 [+2.8]	+1.2 to 2.3 [+2.1]
Jul 2014	+1.0 to +1.5 [+1.3]	+2.0 to +3.0 [+2.8]	+1.3 to +2.3 [+2.1]
Apr 2014	+1.0 to +1.5 [+1.3]	+2.0 to +3.0 [+2.8]	+1.3 to +2.3 [+2.1]

Figures in brackets are the median of forecasts of Policy Board members

Source: Policy Board, Bank of Japan

https://www.boj.or.jp/en/announcements/release_2015/k150121a.pdf

https://www.boj.or.jp/en/announcements/release_2014/k140715a.pdf

The Markit/JMMA Flash Japan Manufacturing PMI Index™ with the Flash Japan Manufacturing PMI™ decreased from 52.2 in Jan to 51.5 in Feb and the Flash Japan Manufacturing Output Index™ did not change from 52.7 in Jan to 52.7 in Feb (http://www.markiteconomics.com/Survey/PressRelease.mvc/ca6a231ce52548dfbbc034868f886d7a). New export orders increased at a faster pace. Amy Brownbill, Economist at Markit, finds improving Japan’s manufacturing (http://www.markiteconomics.com/Survey/PressRelease.mvc/ca6a231ce52548dfbbc034868f886d7a). Private-sector activity in Japan stabilized with the Markit Composite Output PMI Index decreasing from 51.9 in Dec to 51.7 in Jan, indicating modest improvement in business activity (http://www.markiteconomics.com/Survey/PressRelease.mvc/117f9bf5e5ec451ea6dc46bd00bad841). The Markit Business Activity Index of Services decreased to 51.3 in Jan from 51.7 in Dec (http://www.markiteconomics.com/Survey/PressRelease.mvc/117f9bf5e5ec451ea6dc46bd00bad841). Amy Brownbill, Ecoomist at Markit and author of the report, finds the reading consistent with growth in the beginning of 2015 (http://www.markiteconomics.com/Survey/PressRelease.mvc/117f9bf5e5ec451ea6dc46bd00bad841). The Markit/JMMA Purchasing Managers’ Index^™ (PMI™), seasonally adjusted, increased marginally from 52.0 in Dec to 52.2 in Jan (http://www.markiteconomics.com/Survey/PressRelease.mvc/618efac17046436b879e5b824f41cfbf). New orders, output and foreign orders increased. Amy Brownbill, Economist at Markit, finds manufacturing improvement with prices of inputs driven by devaluation (http://www.markiteconomics.com/Survey/PressRelease.mvc/618efac17046436b879e5b824f41cfbf).Table JPY provides the country data table for Japan.

Table JPY, Japan, Economic Indicators

Historical GDP and CPI	1981-2010 Real GDP Growth and CPI Inflation 1981-2010 Blog 8/9/11 Table 26
Corporate Goods Prices	Jan ∆% -1.3 12 months ∆% 0.3 Blog 2/15/15
Consumer Price Index	Jan NSA ∆% -0.2; Jan 12 months NSA ∆% 2.4 Blog 3/1/15
Real GDP Growth	IVQ2014 ∆%: 0.6 on IIIQ2014;  IVQ2014 SAAR 2.2; ∆% from quarter a year earlier: -0.5 % Blog 6/16/13 8/18/13 9/15/13 11/17/13 12/15/13 2/23/14 3/16/14 5/18/14 6/15/14 8/17/14 9/14/14 11/23/14 12/14/14 2/22/15
Employment Report	Jan Unemployed 2.31 million Change in unemployed since last year: minus 70 thousand Unemployment rate: 3.6 % Blog 3/1/15
All Industry Indices	Dec month SA ∆% -0.3 12-month NSA ∆% -0.9 Blog 2/22/15
Industrial Production	Jan SA month ∆%: 4.0 12-month NSA ∆% -2.6 Blog 3/1/15
Machine Orders	Total Dec ∆% 8.6 Private ∆%: 17.5 Dec ∆% Excluding Volatile Orders 8.3 Blog 2/15/15
Tertiary Index	Dec month SA ∆% -0.3 Dec 12 months NSA ∆% minus -0.8 Blog 2/15/15
Wholesale and Retail Sales	Jan 12 months: Total ∆%: -2.9 Wholesale ∆%: -3.4 Retail ∆%: -2.0 Blog 3/1/15
Family Income and Expenditure Survey	Jan 12-month ∆% total nominal consumption -2.4, real -5.1 Blog 3/1/15
Trade Balance	Exports Jan 12 months ∆%: 17.0 Imports Jan 12 months ∆% -9.0 Blog 2/22/15

Links to blog comments in Table JPY:

2/22/15 http://cmpassocregulationblog.blogspot.com/2015/02/world-financial-turbulence-squeeze-of.html

2/15/15 http://cmpassocregulationblog.blogspot.com/2015/02/g20-monetary-policy-recovery-without.html

12/14/14 http://cmpassocregulationblog.blogspot.com/2014/12/global-financial-and-economic-risk.html

11/23/14 http://cmpassocregulationblog.blogspot.com/2014/11/squeeze-of-economic-activity-by-carry.htm

9/14/14 http://cmpassocregulationblog.blogspot.com/2014/09/geopolitics-monetary-policy-and.html

8/17/2014 http://cmpassocregulationblog.blogspot.com/2014/08/weakening-world-economic-growth.html

6/15/2014 http://cmpassocregulationblog.blogspot.com/2014/06/financialgeopolitical-risks-recovery.html

5/18/14 http://cmpassocregulationblog.blogspot.com/2014/05/world-inflation-waves-squeeze-of.html

3/16/2014 http://cmpassocregulationblog.blogspot.com/2014/03/global-financial-risks-recovery-without.html

2/23/14 http://cmpassocregulationblog.blogspot.com/2014/02/squeeze-of-economic-activity-by-carry.html

12/15/13 http://cmpassocregulationblog.blogspot.com/2013/12/theory-and-reality-of-secular.html

11/17/13 http://cmpassocregulationblog.blogspot.com/2013/11/risks-of-unwinding-monetary-policy.html

9/15/13 http://cmpassocregulationblog.blogspot.com/2013/09/recovery-without-hiring-ten-million.html

8/18/13 http://cmpassocregulationblog.blogspot.com/2013/08/duration-dumping-and-peaking-valuations.html

The employment report for Japan in Jan 2015 is in Table VB-1. The number unemployed reached 2.31 million in Jan 2015, declining 70 thousand from a year earlier or 2.7 percent. The rate of unemployment not seasonally adjusted reached 3.5 percent, decreasing 0.2 percentage points from a year earlier. Population decreased 0.1 percent from a year earlier. The labor force increased 0.4 percentage points from a year earlier and the labor participation rate stood at 59.3, decreasing 0.6 percentage points from a year earlier. The employment rate moved to 59.0 percent, which is higher by 0.3 percentage points relative to a year earlier.

Table VB-1, Japan, Employment Report Jan 2015 

Jan 2015 Unemployed	2.31 million
Change since last year	-70 thousand; ∆% –2.9
Unemployment rate	SA 3.6%, 0.2 from earlier month; NSA 3.5%, -0.2 from earlier year
Population ≥ 15 years	110.77 million
Change since last year	∆% -0.1
Labor Force	65.40 million
Change since last year	∆% 0.6
Employed	63.09 million
Change since last year	∆% 0.8
Labor force participation rate	59.0
Change since last year	0.3
Employment rate	57.0%
Change since last year	0.5

Source: Japan, Statistics Bureau, Ministry of Internal Affairs and Communications

http://www.stat.go.jp/english/data/roudou/results/month/index.htm

Table VB-2 provides the rate of unemployment of Japan seasonally adjusted that decreased to 3.6 percent in Jan 2014 from 4.4 percent in May 2012. The rate of unemployment SA fell 0.1 percentage points from 3.7 percent in Jan 2014 to 3.6 percent in Jan 2015.

Table VB-2, Japan, Unemployment Rate, SA

	Unemployment Rate SA
Jan 2015	3.6
Dec 2014	3.4
Nov	3.5
Oct	3.5
Sep	3.6
Aug	3.5
Jul	3.7
Jun	3.7
May	3.6
Apr	3.6
Mar	3.6
Feb	3.6
Jan	3.7
Dec 2013	3.7
Nov	3.9
Oct	4.0
Sep	4.0
Aug	4.1
Jul	3.9
Jun	3.9
May	4.1
Apr	4.1
Mar	4.1
Feb	4.3
Jan	4.2
Dec 2012	4.3
Nov	4.1
Oct	4.1
Sep	4.3
Aug	4.2
Jul	4.4
Jun	4.3
May	4.4

Source: Source: Japan, Statistics Bureau, Ministry of Internal Affairs and Communications

http://www.stat.go.jp/english/data/roudou/results/month/index.htm

Chart VB-1 of Japan’s Statistics Bureau at the Ministry of Internal Affairs and Communications provides the unemployment rate of Japan from 2012 to 2014. There is clear trend of decline with multiple oscillations and increase in Jun-Jul 2014. The rate increased in Sep 2014 and fell in Oct 2014, stabilizing in Nov 2014 and declining in Dec 2014. The rate increased in Jan 2015.

Chart VB-1, Japan, Unemployment Rate, Seasonally Adjusted

Source: Japan, Statistics Bureau, Ministry of Internal Affairs and Communications

http://www.stat.go.jp/english/data/roudou/results/month/index.htm

During the “lost decade” of the 1990s from 1991 to 2002 (Pelaez and Pelaez, The Global Recession Risk (2007), 82-3), Japan’s GDP grew at the average yearly rate of 1.0 percent, the CPI at 0.1 percent and the implicit deflator at minus 0.8 percent. Japan’s growth rate from the mid-1970s to 1992 was 4 percent (Ito 2004). Table VB-3 provides Japan’s rates of unemployment, participation in labor force and employment for selected years from 1953 to 1985 and yearly from 1990 to 2015. The rate of unemployment jumped from 2.1 percent in 1991 to 5.4 percent in 2002, which was a year of global economic weakness. The participation rate dropped from 64.0 percent in 1992 to 61.2 percent in 2002 and the employment rate fell from 62.6 percent in 1992 to 57.9 percent in 2002. The rate of unemployment rose from 3.9 percent in 2007 to 5.1 percent in 2010, falling to 4.6 percent in 2011, 4.3 percent in 2012 and 3.6 percent in 2014. The participation rate fell from 60.4 percent in 2007 to 59.6 percent in 2010, falling to 59.3 percent in 2011 and 59.1 in 2012 and increasing to 59.4 percent in 2014. The employment rate fell from 58.1 in percent in 2007 to 56.6 percent in 2010 and 56.5 percent in 2011 and 2012, increasing to 57.3 percent in 2014. The global recession adversely affected labor markets in advanced economies.

Table VB-3, Japan, Rates of Unemployment, Participation in Labor Force and Employment, %

	Participation Rate	Employment Rate	Unemployment Rate
1953	70.0	68.6	1.9
1960	69.2	68.0	1.7
1965	65.7	64.9	1.2
1970	65.4	64.6	1.1
1975	63.0	61.9	1.9
1980	63.3	62.0	2.0
1985	63.0	61.4	2.6
1990	63.3	61.9	2.1
1991	63.8	62.4	2.1
1992	64.0	62.6	2.2
1993	63.8	62.2	2.5
1994	63.6	61.8	2.9
1995	63.4	61.4	3.2
1996	63.5	61.4	3.4
1997	63.7	61.5	3.4
1998	63.3	60.7	4.1
1999	62.9	59.9	4.7
2000	62.4	59.5	4.7
2001	62.0	58.9	5.0
2002	61.2	57.9	5.4
2003	60.8	57.6	5.3
2004	60.4	57.6	4.7
2005	60.4	57.7	4.4
2006	60.4	57.9	4.1
2007	60.4	58.1	3.9
2008	60.2	57.8	4.0
2009	59.9	56.9	5.1
2010	59.6	56.6	5.1
2011	59.3	56.5	4.6
2012	59.1	56.5	4.3
2013	59.3	56.9	4.0
2014	59.4	57.3	3.6

Source: Japan, Statistics Bureau, Ministry of Internal Affairs and Communications

http://www.stat.go.jp/english/data/roudou/results/month/index.htm

Industrial production in Japan increased 4.0 percent in Jan 2015 and decreased 2.6 percent in 12 months, as shown in Table VB-4. Industrial production increased 0.8 percent in Dec 2014 and 0.1 percent in 12 months. Industrial production decreased 0.5 percent in Nov 2014 and decreased 3.7 percent in 12 months. Industrial production increased 0.4 percent in Oct 2014 and decreased 0.8 percent relative to a year earlier. Industrial production increased 2.9 percent in Sep 2014 and 0.8 percent in 12 months. Industrial production decreased 1.9 percent in Aug 2014 and fell 3.3 percent in 12 months. Industrial production increased 0.4 percent in Jul 2014 and fell 0.7 percent in 12 months. Japan’s industrial production fell 3.4 percent in Jun 2014 and increased 3.1 percent in 12 months. In May 2014, industrial production in Japan increased 0.7 percent, rebounding from the increase in the sales tax, and increased 1.0 percent in the 12 months ending in May 2014. Industrial production fell 2.8 percent in Apr 2014, mostly because of the increase in the tax on value added of consumption in Apr 2014, and increased 3.8 percent in 12 months. Decline of 2.8 percent in Jun 2013 interrupted four consecutive monthly increases from Feb through May 2013. Another interruption occurred in Aug 2013 with decrease of 0.5 percent and decline of 0.6 percent in 12 months. There was a third interruption with decline of 2.3 percent in Feb 2014 but increase of 7.0 percent in 12 months. Japan’s industrial production is strengthening with growth of 1.4 percent in Dec 2012, 0.9 percent in Feb 2013, 0.3 percent in Mar 2013, 0.6 percent in Apr 2013, 2.1 percent in May 2013, 2.7 percent in Jul 2013, 1.5 percent in Sep 2013, 0.6 percent in Oct 2013 and 0.5 percent in Dec 2013. Improvement continued with 3.9 percent in Jan 2014 and rebound of 0.7 percent in May 2014 from the drop of 2.8 percent in Apr caused by the increases in the sales tax. Growth in 12 months improved from minus 10.0 percent in Feb 2013 to 7.2 percent in Dec 2013, 10.6 percent in Jan 2014, 7.0 percent in Feb 2014 and 7.4 percent in Mar 2014. The increase of the sales tax of Apr 2014 interrupted improvement but growth in 12 months was positive at 1.0 percent in May 2014 and 3.1 percent in Jun 2014. There is deterioration in Nov 2014 with decline of 3.7 percent in 12 months followed by growth of 0.1 percent in the 12 months ending in Dec 2014. Industrial production fell 2.6 in the 12 months ending in Jan 2015. Industrial production fell 21.9 percent in 2009 after falling 3.4 percent in 2008 but recovered by 15.6 percent in 2010. The annual average in calendar year 2011 fell 2.8 percent largely because of the Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. Industrial production increased 0.6 percent in 2012 and fell 0.8 percent in 2013. Industrial production grew 2.0 percent in 2014.

Table VB-4, Japan, Industrial Production ∆%

	∆% Month SA	∆% 12 Months NSA
Jan 2015	4.0	-2.6
Dec 2014	0.8	0.1
Nov	-0.5	-3.7
Oct	0.4	-0.8
Sep	2.9	0.8
Aug	-1.9	-3.3
Jul	0.4	-0.7
Jun	-3.4	3.1
May	0.7	1.0
Apr	-2.8	3.8
Mar	0.7	7.4
Feb	-2.3	7.0
Jan	3.9	10.6
Dec 2013	0.5	7.2
Nov	0.3	4.8
Oct	0.6	5.4
Sep	1.5	5.3
Aug	-0.5	-0.6
Jul	2.7	1.9
Jun	-2.8	-4.7
May	2.1	-1.0
Apr	0.6	-3.2
Mar	0.3	-7.0
Feb	0.9	-10.0
Jan	-0.7	-6.4
Dec 2012	1.4	-7.6
Nov	-1.0	-5.5
Oct	0.3	-4.7
Sep	-2.2	-7.6
Aug	-1.4	-4.1
Jul	-0.5	0.1
Jun	-0.8	-0.6
May	-1.8	7.6
Apr	-0.5	15.1
Mar	0.2	16.6
Calendar Year
2014		2.0
2013		-0.8
2012		0.6
2011		-2.8
2010		15.6

Source: Japan, Ministry of Economy, Trade and Industry (METI)

http://www.meti.go.jp/english/statistics/index.html

The survey of household income and consumption of Japan in Table VB-5 is showing noticeable improvement in recent months relative to earlier months with interruption in Apr-May 2014 because of the increase in the tax on value added of consumption. Table VB-4 shows decrease of nominal consumption of 2.4 percent in the 12 months ending in Jan 2015 and decrease of 5.1 percent in real terms. There are likely effects of anticipating consumption before the increase in the value added tax on consumption in Apr 2014 with decline of consumption after the actual increase of the tax. There are segments of decreasing real consumption in Dec 2014: furniture and household utensils 6.5 percent in nominal terms and 8.8 percent in real terms. Transportation/communications decreased 5.6 percent in nominal terms and 6.0 percent in real terms. Clothing and footwear decreased 15.9 percent in real terms and decreased 12.6 percent in nominal terms. Education increased 3.6 percent in real terms and 5.9 percent in nominal terms. Fuel, light and water charges increased 2.6 percent in nominal terms and decreased 1.3 percent in real terms. Real household income decreased 2.3 percent; real disposable income decreased 2.5 percent; and real consumption expenditures decreased 4.3 percent.

Table VB-5, Japan, Family Income and Expenditure Survey, 12-month ∆% Relative to a Year Earlier

Jan 2015	Nominal	Real
Households of Two or More Persons
Total Consumption	-2.4	-5.1
Excluding Housing, Vehicles & Remittance	-2.0	-4.7
Food	0.8	-3.3
Housing	-6.6	-8.1
Fuel, Light & Water Charges	2.6	-1.3
Furniture & Household Utensils	-6.5	-8.8
Clothing & Footwear	-12.6	-15.9
Medical Care	4.5	2.8
Transport and Communications	-5.6	-6.0
Education	5.9	3.6
Culture & Recreation	-8.3	-11.3
Other Consumption Expenditures	-2.1	-4.8*
Workers’ Households
Income	0.4	-2.3
Disposable Income	0.2	-2.5
Consumption Expenditures	-1.6	-4.3

*Real: nominal deflated by CPI excluding imputed rent

Source: Ministry of Internal Affairs and Communications, Statistics Bureau, Director General for Policy Planning and Statistical Research and Training Institute

http://www.stat.go.jp/english/data/kakei/156.htm

Chart VB-2 of the Ministry of Internal Affairs and Communication provides year-on-year change of real consumption expenditures. There is improvement followed by deterioration in the final segment with wide oscillations. There was deterioration in Nov 2011, renewed strength in Dec 2011, another decline in Jan 2012 and increase in Feb and Mar 2012 with stabilization in Apr and May 2012 but sharp decline into Jun 2012. Recovery in Jul and Aug 2012 was interrupted in Sep-Oct 2012 and new increases in Nov 2012, Jan 2013, Feb 2013, Mar 2013 and Apr 2013 (http://www.stat.go.jp/english/data/kakei/156.htm). Total consumption decreased 1.6 percent in real terms in May 2013 and decreased 1.9 percent in nominal terms relative to a year earlier. Real consumption fell 0.4 percent in Jun 2013 and nominal consumption declined 0.1 percent. Consumption rebounded in Jul 2013 with increase of real consumption by 0.1 percent and nominal consumption by 1.0 percent. In Aug 2013, real consumption fell 1.6 percent relative to a year earlier and 0.5 percent in nominal terms. There was marked improvement in Sep 2013 with growth of nominal consumption of 5.2 percent in 12 months and 3.7 percent in real consumption. Nominal consumption increased 2.1 in Nov 2013 and real consumption increased 0.2 percent. Nominal consumption increased 2.7 percent in Dec 2013 and real consumption increased 0.7 percent. In Jan 2014, nominal consumption increased 2.8 percent and real consumption 1.1 percent. Nominal consumption decreased 0.6 percent in Feb 2014 and real consumption decreased 2.5 percent. Nominal consumption increased 9.3 percent in Mar 2014 and real consumption 7.2 percent. The final segment of Chart VB-2 shows contraction of nominal consumption expenditures of 0.7 percent in Apr 2014 and decline of real consumption of 4.6 percent largely because of the increase in the tax on value added of consumption. Contraction deepened with decline of nominal consumption expenditures by 3.9 percent in May 2014 and decline of real consumption expenditures by 8.0 percent. Recovery occurred in Jun 2014 with increase of nominal consumption by 1.3 percent and milder decline of real consumption by 3.0 percent. There is new deterioration in Jul 2013 with decline of 2.0 percent in nominal terms and 5.9 percent in real terms. Nominal consumption fell 0.9 percent in the 12 months ending in Aug 2014 and real consumption fell 4.7 percent. Real consumption expenditures fell 5.6 percent in the 12 months ending in Sep 2014 and nominal consumption expenditures decreased 1.9 percent. Real consumption expenditures fell 4.0 percent in the 12 months ending in Oct 2014 and nominal consumption expenditures fell 0.7 percent. Real consumption expenditures decreased 2.5 percent in the 12 months ending in Nov 2014 and nominal consumption increased 0.3 percent. Real consumption decreased 3.4 percent in the 12 months ending in Dec 2014 and nominal consumption fell 0.6 percent. Real consumption decreased 5.1 percent in the 12 months ending in Jan 2015 and nominal consumption fell 2.4 percent.

Chart VB-2, Japan, Real Percentage Change of Consumption Year-on-Year

Source: Ministry of Internal Affairs and Communications, Statistics Bureau, Director General for Policy Planning and Statistical Research and Training Institute

http://www.stat.go.jp/english/data/kakei/156.htm

Percentage changes in 12 months of nominal and real consumption expenditures in Japan are provided in Table VB-6. Real consumption decreased 5.1 percent in the 12 months ending in Jan 2015 and nominal consumption decreased 2.4 percent. Real consumption fell 3.4 percent in the 12 months ending in Dec 2014 while nominal consumption fell 0.6 percent. Real consumption fell 2.5 percent in the 12 months ending in Nov 2014 and nominal consumption increased 0.3 percent. In Oct 2014, real consumption fell 4.0 percent in 12 months and nominal consumption fell 0.7 percent. Real consumption fell 5.6 percent in the 12 months ending in Sep 2014 while nominal consumption fell 1.9 percent. In Real consumption fell 4.7 percent in Aug 2014 while nominal consumption fell 0.9 percent. In Jul 2014, real consumption declined 5.9 percent and nominal consumption fell 2.0 percent. Real consumption fell 3.0 percent in Jun 2014 while nominal consumption increased 1.3 percent. Real consumption fell 8.0 percent in the 12 months ending in May 2014 and nominal consumption fell 3.9 percent largely because of the increase in the sales tax in Apr 2014. Real consumption fell 4.6 percent in the 12 months ending in Apr 2014 and nominal consumption fell 0.7 percent because of the increase in the sales tax in Apr 2014. Real consumption increased 7.2 percent in the 12 months ending in Mar 2013 while nominal consumption increased 9.3 percent, partly in anticipation of the increase in the value added tax in Apr 2014. Real consumption fell 2.5 percent in the 12 months ending in Feb 2014 and nominal consumption fell 0.6 percent. Real consumption expenditures increased 1.1 percent in the 12 months ending in Jan 2014 and nominal consumption expenditures 2.8 percent. Real consumption expenditures increased 0.7 percent in the 12 months ending in Dec 2013 and nominal consumption expenditures increased 2.7 percent. Real consumption expenditures increased 0.2 percent in the 12 months ending in Nov 2013 and nominal consumption expenditures increased 2.1 percent. Real consumption expenditures increased 0.9 percent in the 12 months ending in Oct 2013 and nominal consumption expenditures increased 2.3 percent. Real consumption expenditures increased 3.7 percent in the 12 months ending in Sep 2013 and nominal consumption expenditures 5.2 percent. Real consumption expenditures fell 1.6 percent in Aug 2013 relative to a year earlier and nominal consumption expenditures fell 0.5 percent. There is recovery in Jul 2013 with real consumption expenditures increasing 0.1 percent and nominal consumption expenditures increasing 1.0 percent. Real consumption expenditures decreased 0.4 percent in the 12 months ending in Jun 2013 and 0.1 percent in nominal terms. Declines in May and Jun 2013 interrupted growth from Jan to Apr 2013. There was sharp decline in nominal consumption of 8.8 percent in Mar 2011 and 8.2 percent in real consumption because of the Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. Dec was the first month in 2011 with increases in 12 months in both nominal and real consumption expenditures followed by Feb 2012 through Aug 2012. Nominal and real consumption fell in both Sep and Oct 2012 and increased in Nov 2012. Real consumption fell 0.7 percent in the 12 months ending in Dec 2012 and nominal consumption fell 0.8 percent. Real consumption expenditures increased 2.4 percent in the 12 months ending in Jan 2013 and 2.1 percent in nominal terms. Nominal consumption increased 0.8 percent in Feb 2013 and nominal consumption increased 0.1 percent. Real consumption increased 5.2 percent in the 12 months ending in Mar 2013 and nominal consumption 4.1 percent. Real consumption fell 4.6 percent in the 12 months ending in Apr 2014 and nominal consumption fell 0.7 percent. Consumption was an important driver of GDP growth in Japan in IQ2012. Real GDP grew at the seasonally adjusted annual rate (SAAR) of 4.4 percent in IQ2012 with private consumption contributing 1.4 percentage points for the highest contribution to growth (Table VB-2 at http://cmpassocregulationblog.blogspot.com/2015/02/world-financial-turbulence-squeeze-of.html). There was deceleration in IIQ2012 with growth of GDP at SAAR of minus 1.5 percent and contribution of 1.6 percentage points of personal consumption. In IIIQ2012, Japan’s GDP contracted at the SAAR of 2.2 percent and personal consumption deducted 0.8 percentage points. Japan’s GDP grew at the SAAR of minus 0.7 percent in IVQ2012 with personal consumption contributing 0.2 percentage points. Japan’s GDP growth in IQ2013 was at 5.7 percent SAAR with highest contribution of 3.2 percentage points by personal consumption expenditures. In IIQ2013, Japan’s GDP grew at 3.2 percent SAAR with personal consumption expenditures contributing 2.0 percentage points. Japan’s GDP grew at 1.5 percent SAAR in IIIQ2013 with personal consumption expenditures contributing 0.8 percentage points. In IVQ2013, Japan’s GDP grew at minus 1.4 percent SAAR with personal consumption expenditures deducting 0.3 percentage points. The GDP of Japan grew at 5.5 percent SAAR in IQ2014 with personal consumption expenditures contributing 5.4 percent. Japan’s GDP contracted at SAAR of 6.7 percent in IIQ2014 with personal consumption expenditures deducting 12.5 percent in large part because of the increase of the sales tax in Apr 2014. The GDP of Japan contracted at 2.3 percent SAAR in IIIQ2014 with personal consumption expenditures adding 0.0 percentage points. Japan’s GDP grew at 2.2 SAAR in IVQ2014 with contribution of 0.7 percent of personal consumption expenditures.

Table VB-6, Japan, Family Income and Expenditure Survey 12-months ∆% Relative to a Year Earlier

	Nominal Consumption Expenditures ∆% Relative to a Year Earlier	Real Consumption Expenditures ∆% Relative to a Year Earlier
Jan 2015	-2.4	-5.1
Dec 2014	-0.6	-3.4
Nov	0.3	-2.5
Oct	-0.7	-4.0
Sep	-1.9	-5.6
Aug	-0.9	-4.7
Jul	-2.0	-5.9
Jun	1.3	-3.0
May	-3.9	-8.0
Apr	-0.7	-4.6
Mar	9.3	7.2
Feb	-0.6	-2.5
Jan	2.8	1.1
Dec 2013	2.7	0.7
Nov	2.1	0.2
Oct	2.3	0.9
Sep	5.2	3.7
Aug	-0.5	-1.6
Jul	1.0	0.1
Jun	-0.1	-0.4
May	-1.9	-1.6
Apr	0.8	1.5
Mar	4.1	5.2
Feb	0.1	0.8
Jan	2.1	2.4
Dec 2012	-0.8	-0.7
Nov	0.1	0.2
Oct	-0.5	-0.1
Sep	-1.2	-0.9
Aug	1.4	1.8
Jul	1.2	1.7
Jun	1.5	1.6
May	4.3	4.0
Apr	3.2	2.6
Mar	4.1	3.4
Feb	2.7	2.3
Jan	-2.1	-2.3
Dec 2011	0.3	0.5
Nov	-3.8	-3.2
Oct	-0.6	-0.4
Sep	-1.9	-1.9
Aug	-3.9	-4.1
Jul	-1.8	-2.1
Jun	-3.9	-3.5
May	-1.6	-1.2
Apr	-2.5	-2.0
Mar	-8.8	-8.2
Feb	-0.1	0.5
Jan	-0.9	-0.3
Dec 2010	-3.2	-3.3
Dec 2009	0.3	2.1

Source:

Source: Ministry of Internal Affairs and Communications, Statistics Bureau, Director General for Policy Planning and Statistical Research and Training Institute

http://www.stat.go.jp/english/data/kakei/156.htm

Japan is experiencing weak internal demand as in most advanced economies, interrupted by strong growth in IQ2012 but renewed weakening at the end of IIQ2012, beginning of IIIQ2012 and in IVQ2012. There was recovery in IQ2013, IIQ2013 and IIIQ2013. Recovery interrupted in IVQ2013, accelerating in IQ2014. There was weakening again in IIQ2014 and IIIQ2014. Table VB-7 provides Japan’s wholesale and retail sales. There is strong performance in May 2013 with growth of 0.8 percent for retail sales followed by 1.6 percent in Jun 2013. Retail sales fell 0.3 percent in Jul 2013, rebounding 1.1 percent in Aug 2013. Retail sales increased 3.0 percent in the 12 months ending in Sep 2013 and 2.4 percent in the 12 months ending in Oct 2013. Retail sales increased 4.1 percent in the 12 months ending in Nov 2013 and 2.5 percent in the 12 months ending in Dec 2013. Retail sales grew 4.4 percent in the 12 months ending in Jan 2014 and 3.6 percent in the 12 months ending in Feb 2014. Japan’s retail sales increased 11.0 percent in the 12 months ending in Mar 2014 in part anticipating the increase in the tax on the value added of consumption. Retail sales fell 4.3 percent in Apr 2014 after the increase in the sales tax. Retail sales fell 0.4 percent in the 12 months ending in May 2014 and fell 0.6 percent in the 12 months ending in Jun 2014. Retail sales increased 0.6 percent in the 12 months ending in Jul 2014 and 1.2 percent in the 12 months ending in Aug 2014. Retail sales increased 2.3 percent in the 12 months ending in Sep 2014 and 1.4 percent in the 12 months ending in Oct 2014. Retail sales increased 0.5 percent in the 12 months ending in Nov 2014 and 0.2 percent in the 12 months ending in Dec 2014. Retail sales decreased 2.0 percent in the 12 months ending in Jan 2015. Retail sales are recovering from deep drops in Mar and Apr 2011 following the Tōhoku or Great East Earthquake and Tsunami of Mar 11, 2011. Retail sales have been increasing in 12-month percentage changes from Dec 2011 through May 2012. Retail sales fell again by 1.3 percent in Jul 2012, increasing 1.3 percent in Aug 2012 and 0.4 percent in Sep 2012 but declining 1.2 percent in Oct 2012, rebounding by 0.9 percent in Nov 2012 and only 0.2 percent in Dec 2012 but contracting 1.1 percent in Jan 2013 and 2.2 percent in Feb 2013.

Table VB-7, Japan, Wholesale and Retail Sales 12 Month ∆%

	Total	Wholesale	Retail
Jan 2015	-2.9	-3.4	-2.0
Dec 2014	-1.4	-2.0	0.1
Nov	-2.7	-4.1	0.5
Oct	0.3	-0.1	1.4
Sep	1.6	1.3	2.3
Aug	-1.6	-2.8	1.2
Jul	0.1	-0.1	0.6
Jun	-0.6	-0.5	-0.6
May	-1.0	-1.3	-0.4
Apr	-3.4	-3.0	-4.3
Mar	8.5	7.5	11.0
Feb	2.5	2.0	3.6
Jan	4.4	4.4	4.4
Dec 2013	2.8	2.9	2.5
Nov	2.9	2.4	4.1
Oct	2.0	1.8	2.4
Sep	2.8	2.7	3.0
Aug	0.6	0.4	1.1
Jul	1.3	2.0	-0.3
Jun	0.5	0.1	1.6
May	0.6	0.5	0.8
Apr	-0.1	-0.1	-0.2
Mar	-1.3	-1.8	-0.3
Feb	-1.6	-1.3	-2.2
Jan	-0.3	0.1	-1.1
Dec 2012	-1.7	-2.5	0.2
Nov	-0.9	-1.6	0.9
Oct	-1.6	-1.8	-1.2
Sep	-3.6	-5.1	0.4
Aug	-2.7	-4.4	1.3
Jul	-3.1	-4.0	-1.3
Jun	-2.6	-3.6	-0.2
May	2.7	2.6	3.0
Apr	1.8	0.4	5.0
Mar	3.2	0.9	9.3
Feb	-0.1	-1.3	3.1
Jan	-2.1	-3.8	1.6
Dec 2011	-0.8	-2.0	2.5
Nov	-2.3	-2.4	-2.2
Oct	1.1	0.8	1.9
Sep	0.3	0.8	-1.1
Aug	3.1	5.2	-2.6
Jul	2.3	3.0	0.6
Jun	3.1	3.8	1.2
May	1.3	2.3	-1.3
Apr	-2.6	-1.7	-4.8
Mar	-1.3	1.2	-8.3
Feb	5.3	7.2	0.1
Jan	3.3	4.6	0.1
Dec 2010	3.5	5.7	-2.1
Calendar Year
2014	0.6	0.1	1.7
2013	0.9	0.8	1.0
2012	-0.9	-2.0	1.8
2011	1.0	1.9	-1.0
2010	2.4	2.3	2.6
2009	-20.5	-25.6	-2.3
2008	1.2	1.5	0.3

Source: Japan, Ministry of Economy, Trade and Industry (METI)

http://www.meti.go.jp/english/statistics/index.html

© Carlos M. Pelaez, 2009, 2010, 2011, 2012, 2013, 2014, 2015.