Inventories of some materials and electronics parts, for which demand from overseas is declining significantly, have become somewhat excessive, but inventories as a whole still remain at a low level. Meanwhile, corporate profits continue to improve. Income conditions of households still remain severe but are not deteriorating, as employment conditions are on an improving trend.
As for the outlook, public investment is expected to start increasing with the implementation of the government’s new economic stimulus package. In the corporate sector, firms still strongly feel that they have excess capacity and that they should reduce their debts to restore financial soundness.