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Pace of improvement in Japanese employment conditions might weaken – Nomura

FXStreet (Barcelona) - Research Analysts at Nomura, note that the recent decline in job openings and weakening of manufacturing PMI points to a potential slowdown in improving Japanese employment conditions.

Key Quotes

“The unemployment rate in February was 3.5%, down 0.1ppt m-m and in line with the consensus forecast. A breakdown of the February figure shows the number of employed persons rose 0.0% m-m (+20,000 persons), while the number of unemployed persons fell 2.1% m-m (-50,000 persons), for the first decline in three months, and the labor force participation rate held steady from the previous month at 59.7%. February's effective job openings-to-applicants ratio stood at 1.15x, up 0.01pt m-m, which was also in line with the consensus forecast.”

“Employment conditions in January were somewhat weak, but there were signs of improvement in February. However, both the survey of manufacturer production plans and the Japanese manufacturing purchasing managers index (PMI) point to a slowdown in the level of manufacturing activity in March.”

“We think the decline in new job openings in February (-3.5% m-m) suggests the same, and thus look for a slight weakening in the pace of improvement in employment conditions in the near term.”

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