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Japan's Leading Index of Business Conditions Gains in March

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Japan's Leading Index of Business Conditions Gains in March

Despite higher oil bills and Persian Gulf strife, Japan's leading index of business conditions rose to 114.5 in March from 113.2 in February, striking the highest level since April 2022, reported the Cabinet Office on Tuesday.

The leading index attempts to gauge the business outlook for several months ahead, using indicators such as job offers, consumer sentiment, commodity prices, equities prices, small business sentiment, and machinery orders, among other signals.

In recent months, Japan's economy has been showing modest growth, according to the Bank of Japan and other observers.

For example, Japan's composite purchasing managers index (PMI) output index, a combination of the nation's manufacturing and services sectors, logged 52.2 in April, down from 53.0 in March, but still striking above the 50 mark that separates growth from contraction, reported S&P Global.

Japan's gross domestic product (GDP) is expected to expand by a moderate 0.5% in fiscal 2026 started April 1, the Bank of Japan forecast late last month.

Separately, Japan's coincident index of business conditions for March rose to 116.5, inching up from 116.2 in February, added the Cabinet Office.

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