— Japan Apr Tertiary Index +1.4% Y/Y Vs Mar Revised +1.7%
— Japan Tertiary Index Posts 1st M/M Rise In 3 Months
— Japan Tertiary Index Posts 3rd Y/Y Rise In Row

TOKYO (MNI) – Japan’s tertiary industry index, which measures
spending in the services sector, rose 2.1% in April from the previous
month, posting the first month-on-month rise in three months, the
Ministry of Economy, Trade and Industry said on Wednesday.

The April rise, led by software development and other information
services as well as wholesale trade, came after a revised 2.7% fall in
March (vs. -3.0% reported earlier).

The seasonally adjusted index rose to 97.6 in April from a revised
95.6 in March. In January, the index jumped 2.9% m/m to 98.8, which was
the highest level since 100.2 in November 2008.

The reading of 94.4 marked in March 2009, when the index slumped
3.4% m/m, remains the lowest level on record.

Historical data show that the index hit a record high reading of
103.5 in August 2007, when it rose 0.9% from the previous month.

From a year earlier, the unadjusted index rose 1.4% in April to
96.4, marking the third straight year-on-year rise after rising a
revised 1.7% in the previous month (preliminary +1.6%). March’s +1.7%
was the largest y/y gain since +1.9% in February 2008.

A revised 0.6% rise in February this year was the first y/y
increase in 19 months since +0.2% in July 2008.

The index posted a record 7.7% year-on-year drop in March 2009.

In the latest month, the industries that showed increased business
from the previous month were: information and communications (+9.4%),
wholesale and rental trade (+3.6%), real estate and goods rental/leasing
(+0.4%) and utilities (+0.9).

The industries that saw slower business from the previous month
were: personal and amusement services (-1.7%), scientific research,
professional and technical services (-1.5%), learning support (-1.0%),
transport and postal activities (-0.7%), miscellaneous services (-0.4%),
finance and insurance (-0.1%), medical, health care and welfare (-0.1%)
and compound services (-5.0%),

The category of accommodations, eating and drinking services was
unchanged.

The service sector employs more than half of Japan’s workforce, and
spending on services such as retailing, dining and travel is closely
tied to changes in income and consumer confidence.

The METI has changed the base year for the index to 2005 from 2000,
effective with the April 2009 data, resulting in revisions to past
figures dating from January 2003.

The ministry also re-grouped some service industries to reflect
changing business patterns. In particular, it divided up Japan Post’s
huge postal and financial services, which are now being privatized, and
reallocating them into “transport and postal activities” and “finance
and insurance.”

As a result, the category called “compound services” no longer
reflects Japan Post’s diversified postal and financial services but has
shrunk to show the limited commission business at post offices.

tokyo@marketnews.com
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