The Bank of Japan forecast on Tuesday that the world's second largest economy may stop shrinking later this year, and investors signaled that recession in Germany was nearing its low point.
Japan's central bank sounded slightly more optimistic after keeping interest rates unchanged, although its outlook was hedged with caution.
A survey of investors and analysts in Germany, Europe's dominant economy, was much stronger than expected, although that optimism has yet to filter into the real world, where companies are struggling and workers are losing their jobs.
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While is still too early to assess whether it is a temporary or a more durable turning point, OECD composite leading indicators (CLIs) for April 2009 point to a reduced pace of deterioration in most of the OECD economies with stronger signals of a possible trough in Canada, France, Italy and the United Kingdom. The signals remain tentative but they are present in the majority of the CLI component series for these countries. Compared to last month, positive signals are also emerging in Germany, Japan and the United States. However, major non-OECD economies still face deteriorating conditions, with the exception of China and India, where tentative signs of a trough have also emerged. etc.
