World

Japan business sentiment improves for fourth straight quarter

| | Updated on: Dec 16, 2013

Confidence among large Japanese manufacturers climbed in December for the fourth consecutive quarter thanks to a weaker yen, the central bank’s Tankan survey showed Monday.

The closely watched index in the quarterly survey rose by 4 points since September, to plus 16.

A positive number indicates optimists outnumber pessimists.

The index for large non-manufacturers also climbed four points, to plus 20, the survey said.

Large companies in the manufacturing and non-manufacturing sectors now plan to raise capital investment by 4.6 per cent for the current financial year through March 2014, compared with 5.1 per cent in the September survey.

Confidence among medium-sized manufacturers in the world’s third-largest economy rose to 6 from 0 while the index for small manufacturers climbed to 1 from minus 9.

Large manufacturers expected the index to edge down to plus 14 in the next quarter, the survey found.

The yen has fallen about 19 per cent against the US dollar since the start of this year as the Government and the central bank promoted monetary easing measures to pull the economy out of 15 years of deflation.

The average of predicted exchange rates has declined to 96.78 yen to the dollar over the year, from 94.45 yen in September, the survey found.

The depreciation of the currency has boosted profits for Japanese exporters and also helped increase the number of overseas tourists.

Consumer prices rose 0.9 per cent in October from a year earlier for the fifth straight month of increase on higher electricity and other energy prices amid the yen’s fall, the Government said.

The Japanese economy grew at an annual rate of 1.1 per cent in the July-to-September period, revised down from an initial estimate of 1.9 per cent growth due to stalled corporate investment.

Analysts, however, expected the economy to regain momentum as last-minute demand before the scheduled sales-tax hike in April starts to boost purchases of durable goods.

About 10,000 companies were questioned for the latest Tankan survey.

Published on November 25, 2017

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