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UPDATE1: May composite index logs record rise as economy recovers after quake.

TOKYO, July 6 Kyodo

(EDS: ADDS INFO THROUGHOUT)

Japan's index of leading economic indicators, which shows how the economy is likely to perform in coming months, marked a record rise in May, evidence the world's third-largest economy is poised to recover strongly from the March earthquake and tsunami due to an upturn in production, government data showed Wednesday.

The index of leading indicators rose to 99.8 in May, from 96.2 in April, for the first gain in three months and biggest increase since 1980 when the current data series began, the Cabinet Office said.

The jump was due largely to the substantially improved outlooks for durable goods shipments, consumer confidence and earnings by smaller companies, the office said in a preliminary report.

The index of coincident indicators, which reflects current economic conditions and is based on measurements of industrial output, large-lot electricity use and other readings, stood at 106.0, up from 103.6. That is the second consecutive month of increase, and follows a record drop in March when a large swath of northeastern Japan was devastated by a massive earthquake and tsunami.

The government left its basic assessment of the index unchanged, saying the result signals ''improvement.''

The index of lagging indicators, measuring economic performance over recent months, rose to 91.5 in May from 90.8 in April. That was the second straight monthly increase, reflecting recovering household spending and improving employment conditions, the data showed.
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Publication:Japan Weekly Monitor
Date:Jul 11, 2011
Words:241
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