TOKYO: The Japanese government raised its assessment of the economy in January for the first time in seven months due to rising consumer spending, an encouraging sign that inflation could start to pick up this year.
“Japan’s economy is gradually recovering,” the Cabinet Office said in its monthly economic report on Friday. That marked an upgrade from December, when the Cabinet Office said the economy is on a recovery path.
The government also raised its assessment of consumer spending for the first time in seven months after retail sales, household spending, and new car sales gained momentum toward the end of last year.
Consumer spending is “recovering,” which is an upgrade from the phrase “gradual recovery” used in last month’s report.
The assessment increases the chance that the government will declare an end to deflation, which would amount to a declaration of victory for Prime Minister Shinzo Abe’s ambitious campaign to reflate the economy.
Data for November and December showed consumer spending bounced back from a brief lull caused by bad weather, a Cabinet Office official told reporters.
Improving consumer sentiment, and rising restaurant sales, are also reasons to be optimistic about consumption, the official said.
However, the Cabinet Office left unchanged its assessment that consumer prices are flat, showing it may still take some time for improvements in the economy to feed through to consumer prices.
The Cabinet Office also stuck with its view that industrial output and capital expenditure are gradually expanding.
Abe took office in late 2012 with a bold plan to shake off 15 years of deflation and sub-par growth.
Gross domestic product has expanded for the past seven quarters, the strongest run of growth in a decade. The output gap shows demand exceeds supply by the most in more than nine years. Stock prices are their highest in 26 years, and corporate profits are near an all-time high.
Business investment is rising, exports are growing, and the labor market is the tightest in decades, due partly to a shrinking population.
Japan’s economy minister has hinted that it is possible to declare an end to deflation before consumer prices reach the Bank of Japan’s 2 percent inflation target.
In November, the core consumer price index, which includes oil products but excludes fresh food, rose 0.9 percent year-on-year. This is an improvement over 2016, when prices fell, but still not close to the BOJ’s price target.
Japan government upgrades economic view on rising consumer spending
Japan government upgrades economic view on rising consumer spending
Closing Bell: Saudi main index rises to 10,894
RIYADH: Saudi Arabia’s Tadawul All Share Index extended its upward trend for a third consecutive day this week, gaining 148.18 points, or 1.38 percent, to close at 10,893.63 on Tuesday.
The total trading turnover of the benchmark index stood at SR6.05 billion ($1.61 billion), with 144 listed stocks advancing and 107 declining.
The Kingdom’s parallel market Nomu also rose by 81.35 points to close at 23,668.29.
The MSCI Tadawul Index edged up 1.71 percent to 1,460.89.
The best-performing stock on the main market was Zahrat Al Waha for Trading Co., with its share price advancing 10 percent to SR2.75.
Shares of CHUBB Arabia Cooperative Insurance Co. increased 8.27 percent to SR23.04, while Abdullah Saad Mohammed Abo Moati for Bookstores Co. saw its stock climb 6.17 percent to SR50.60.
Conversely, the share price of Naseej International Trading Co. declined 9.90 percent to SR31.48.
On the announcements front, Arabian Drilling Co. said it secured three contract extensions for land rigs with energy giant Saudi Aramco, totaling SR1.4 billion and adding 25 active rig years to its backlog.
In a Tadawul statement, the company said one rig is currently operational, the second will begin operations by the end of January, and the third — currently suspended — is expected to resume operations in 2026.
Since November 2025, Arabian Drilling has secured seven contract extensions amounting to SR3.4 billion, representing 55 committed rig years.
The three contracts have durations of 10 years, 10 years, and five years, respectively.
“Securing a total of SR1.4 billion in new contracts and expanding our backlog by 25 rig-years demonstrates both the trust our clients place in us and our ability to consistently deliver quality and reliability,” said Ghassan Mirdad, CEO of Arabian Drilling, in a statement.
Shares of Arabian Drilling Co. rose 3.15 percent to SR104.70.
Separately, Alkhorayef Water and Power Technologies Co. said it signed a 36-month contract valued at SR43.35 million with National Water Co. to operate and maintain water networks, pumping stations, wells, reservoirs, and related facilities in Tabuk.
In October, Alkhorayef Water and Power Technologies Co. announced it had been awarded the contract by NWC.
In a Tadawul statement, the company said the financial impact of the deal began in the fourth quarter of 2025.
The share price of Alkhorayef Water and Power Technologies Co. declined 0.49 percent to SR120.70.
