Bank of Japan’s monthly report of recent economic and financial developments1 Bank of Japan, Communication, 16/02/99. The Bank’s View2 The economic deterioration in Japan has become moderate against the background of the increase in public investment. Business fixed investment has been declining significantly. As for housing investment, housing starts are bottoming out but remain at a low level.
Recovery in private consumption has been weak on the whole, although partial improvement in sales of goods has been observed. Meanwhile, net exports (exports minus imports) basically remain on a gradually increasing trend, and public investment is increasing considerably. Reflecting this development of final demand and the continued progress in inventory adjustments, industrial production, which had been on a downtrend, is leveling off.