A key index of economic activity in Japan rose in May from April, but remained below the boom-bust 50 mark for the third straight month. The leading index of economic indicators stood at 44.4 points in May, up from 30 in April, the Ministry of Public Management, Home Affairs, Posts and Telecommunications said. A reading under 50 points suggests the economy is heading towards contraction. The index had been expected to rise to 35 points.
Despite the stronger than expected reading in the leading indicators, the fact that the index remained under 50 will temper any hopes that Japan is heading for a recovery following this week's increase in the Tankan survey of business confidence. A separate report today showed that household spending fell 0.8pc in May from a year earlier, the seventh straight month of decline. //www.fxcentre.com