Japanese industrial growth has clearly improved this year. Yet, the weakness in the global economy, and particularly in its largest trading partner, China, raises questions regarding the sustainability of this upturn.

Ultimately, the cyclical indicators driving Japanese industrial growth will determine whether the upturn continues. Since ECRI’s Japanese Leading Manufacturing Index (JALMI) is comprised of leading indicators that anticipate cycles in Japanese industrial growth, the growth rate of the JALMI provides early warning about changes in the Japanese industrial growth outlook.