Japan jobless rate up as Noda takes the reins
Japan's jobless rate rose for a second month and retail sales dropped, underscoring the challenge for incoming prime minister Yoshihiko Noda in securing Japan's recovery from the March 11 earthquake.
The unemployment rate rose to 4.7pc in July as payrolls fell by 40,000 from a month earlier, the statistics bureau said in Tokyo. Retail sales slid a seasonally adjusted 0.3pc from June, a trade ministry report showed.
Noda, who was elected premier by the lower house of parliament, inherits a recovery under threat from an advancing yen and a global slowdown.
A weakening economy will complicate his task of funding the next reconstruction package, according to economist Yoshimasa Maruyama. "Today's reports show Japan's recovery is levelling off in the middle of the post-earthquake rebound.
"Noda wants to raise taxes in the next fiscal year but that may have to be postponed. The economy won't be strong enough," said Maruyama, a senior economist at Itochu in Tokyo.
Noda is Japan's sixth prime minister in five years. As finance minister, he advocated raising taxes to fund quake relief. The previous packages totalled 6trillion yen (€54bn), or about a third of the 16.9trn yen (€152bn) in damages from the disaster. (Bloomberg)