Japanese economy beginning to recover

Japan's economy may have started to recover in April after a sharp contraction in March. From Reuters:

Japan's industrial output edged up in April after a record fall in March and companies expect bigger gains in the next two months, adding to evidence that a recovery from the March 11 earthquake and tsunami is under way.

Output rose 1.0 percent last month, below analysts' median 2.8 percent forecast, but manufacturers sharply increased their forecast for May, predicting output would rise 8.0 percent compared with the previous 2.7 percent forecast, data from the Ministry of Economy, Trade and Industry showed on Tuesday.

Companies expect the recovery to continue in June with production seen rising 7.7 percent, in a sign they are making headway in restoring supply chains and bringing back production lines idled by the disaster and power blackouts...

Underscoring lingering weakness in consumption, household spending fell 3.0 percent in April from a year earlier, after a record 8.5 percent annual drop seen the previous month and against a median forecast for a 2.9 percent annual decline, government data showed.

The jobless rate inched up to 4.7 percent from 4.6 percent seen in March, as expected, while the availability of jobs fell to 0.61 from 0.63 in March, below 0.62 expected by economists, meaning that there were more than three jobs available for every five job seekers.

In another indication that Japanese industry is recovering, Reuters also reports a rise in the manufacturing PMI in May.

Japanese manufacturing activity rebounded from a two-year low in May and expanded for the first time in three months as firms restored supply chains disrupted by the March 11 earthquake and tsunami, a survey showed on Tuesday.

The Markit/JMMA Japan Manufacturing Purchasing Managers Index (PMI) rose to a seasonally adjusted 51.3 in May from 45.7 in April, which was the lowest since April 2009.