Tokyo, April 20 (Bloomberg) -- Takehiro Sato, the most accurate of the regularcontributors to Bloomberg News economic surveys last year, is also the mostpessimistic -- forecasting a `wok-shaped' recovery for Japan's stalledeconomy. Sato, an economist at Morgan Stanley Dean Witter Japan Ltd., doesn'texpect the economy to pick up until the second half of next year. He expectsgrowth of 0.2 percent this year, below the 0.9 percent median forecast in thelatest Bloomberg survey. The economy's ``peak was August,'' said Sato. ``Since the downtrend has justbegun, the end is a long way off.'' Sato, a graduate of Kyoto University, joined Morgan Stanley in October 1999,after stints at Sumitomo Bank, the Japan Research Institute Ltd. and KobeUniversity, where he lectured. He was followed in the rankings by J.P. MorganSecurities (Asia) Ltd. senior economist James Malcolm and Aozora BankLtd.'s senior economist Yasukazu Shimizu. Sato and colleague Robert Feldman say Japan's fate rests on a recovery inexport demand from the U.S., which is Japan's biggest single market. Exports were the major driver of Japan's recovery over the past two years, asmanufacturers at home invested in more equipment and boosted production tomeet the demand. This year, the volume of exports has fallen for three monthsin a row on waning demand in all of Japan's major trading partners -- Asia, theU.S. and the European Union. That has hurt business confidence, which fell for the first time in more thantwo years, according to the Bank of Japan's most widely-watched businesssurvey, and the central bank and the government have given their gloomiesteconomic assessment in about three years.
Rankings
The rankings are determined by awarding a sliding scale of points based onthe relative accuracy of forecasts for seven key economic indicatorsBloomberg regularly surveys, comprising three monthly reports and threequarterly reports. The rankings also take into account the number of surveysfor which forecasts are submitted. The index contains four monthly economic indicators for which Bloombergconducts regular surveys -- industrial output, tertiary activity index, machineryorders and trade -- and three quarterly indicators -- GDP, the privateconsumption component of GDP and the Tankan diffusion index of largemanufacturers' sentiment. For the total of 15 indicators covered in the quarter, five points are awarded forthe most accurate forecast, three points for the next accurate, and one pointfor the third closest. Sato was consistent throughout the year, placing in the top 10 in three of thefour quarters, and also scored the highest placing ratio, which means hisestimates were close more often than his rivals. His accuracy was balanced,scoring points in all seven categories.
Top Three
Runner-up Malcolm joined J.P. Morgan in 1998, after earning a doctorate fromthe University of Sheffield, England, and the University of Tokyo, where hewrote a thesis on Japan's ``Big Bang'' financial reforms. Malcolm claimed the top spot in the second and fourth quarters last year,most of his points coming from machinery orders and industrial production.Malcolm's consistency was narrowly behind that of Sato's, notching up aplacing in one of every three forecasts. Aozora senior economist Shimizu was the third-best forecaster last year. Hegraduated from the School of Agriculture at Kyoto University in 1990 and wasrecruited at the Fukuoka branch of Aozora, which was then called NipponCredit Bank Ltd. Shimizu ranked in the top 10 in three quarters last year, racking up most ofhis points forecasting the tertiary activity index and industrial production.Shimizu scored points with one in every four estimates.