Is the sun rising again in Japan?

The improvement in consumer confidence reported this morning is consistent with our view that the Japanese economy could start growing again as early as the current quarter. Admittedly, any recovery in sentiment or activity needs to be seen in the context of the sharp falls that have gone before. But the consumer confidence survey at least confirms that further rises in unemployment are unlikely to prevent an economic recovery, and that the risks of a more damaging deflationary spiral are still low.