Japan's economic recovery could be gathering speed

The latest official figures show that Japan's jobless rate fell to 4.4% in April, down from March's 4.5%. It is the lowest figure since October 1998.

A separate official survey showed that Japanese industrial production was increasing, driven by domestic demand.

Yet the jobless figures were mixed, as unemployment rose amongst the young.

The jobless rate increased by 5.6% for people between 25 and 34 compared with 5.2% in April 2004.

Overall, I think the economy is in a steady recovery phase Finance Minister Sadakazu Tanigaki

One Japanese government minister said many young people were now quitting their jobs to seek better positions as the domestic economy improved.

Rise in production

The overall 0.1% drop in unemployment in April beat analysts' expectations, most of whom had predicted no change from March.

The number of people laid off in April was 740,000, a reduction of 160,000 from the same month last year, the figures showed.

Finance Minister Sadakazu Tanigaki said the Japanese economy was moving slowly but firmly towards recovery.

"Overall, I think the economy is in a steady recovery phase," he said.

The Japanese economy grew by 1.3% in the first three months of this year from the previous quarter, or by 5.3% on a year by year basis.