Recovery in Japan looks unsustainable

By Steven Wheeler, head of Japanese equities at Rothschild Asset Management Since the start of 2002, leading economic indicators in Japan have enjoyed a rapid rebound. But the improving tone in the Japanese economy has been driven almost entirely by the strengthening global economy. The domestic economy shows few signs of having any momentum independent of external demand. However, the peaking of the OECD's leading indicator and renewed concerns over the technology cycle mean we are likely to see a pause in the recovery of Japanese indicators over the next few months, and probably...