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Analysts at Nomura are forecasting an April unemployment rate of 2.5%, up 0.1 percentage point (pp) from March for Japanese economy.

Key Quotes

“The job openings-to-applicants ratio, which tends to lead the unemployment rate, was 1.59x for March, the most recent data point, and has been around that level since December 2017, indicating that the tightening in labor supply-demand conditions may have stalled. The April Consumer Confidence Index fell 0.7pp from March, with the employment component of the index falling by a relatively large 1.2pp, and we believe a reaction to the sharp tightening in January-March labor supply-demand is likely. Therefore, we expect the unemployment rate to rise in April from March.”

“We forecast an April job openings-to-applicants ratio of 1.60x, from 1.59x in March. Looking at leading indicators, the March number of new job openings rose month-on-month, which we believe led to an increase in the April job openings-to-applicants ratio.”