Japanese Service Sector Contracts in Fourth Quarter 2002
Mar 3, 2003
The Japanese Tertiary Sector Index of economic activity decelerated for the fourth consecutive month by 0.7% in December to 104.8. In turn, service sector activity for the entire fourth quarter of 2002 dropped by 1.0% from the previous term. Both results were worse than expected.
Of the six business sectors that make up the index, five fell in December from November. The December decline was mainly attributed to a 3.8% contraction in retail activity. GDP figures released last week showed that
consumer spending rose by 0.1% in the fourth quarter of 2002, which was much less than the 0.8% gain recorded in for the third quarter.
The poor performance of the services sector in December 2002 is due to the sluggish demand for services.
Tertiary industry activity marked its first drop in four years in 2002. The index dropped by 1.0%, mainly due to the contraction in wholesale, retail and restaurant activities.
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