Bank of Japan survey shows stable business conditions, but bleaker outlook

TOKYO -- A Japanese central bank survey shows sentiment among big manufacturers is steady, though companies in all sectors expect conditions to deteriorate in the coming months.

See Full Article

The Bank of Japan's "tankan" survey, released Monday, remained at 12 as of December, unchanged from September. The tankan measures corporate sentiment by subtracting the number of companies saying business conditions are negative from those responding they are positive.

The reading for non-manufacturers was 25, also unchanged from September, the survey said. However the number of companies anticipating worse conditions in the coming quarter outnumbered those expecting improvements, with figures of minus 5 for manufacturers and minus 7 for non-manufacturers.

A total of 10,971 companies responded to the survey.

The survey for the coming quarter showed both manufacturers and other companies were pessimistic about the outlook for sales and for investment in the world's third-largest economy.

Japanese companies have seen their profits soar since Prime Minister Shinzo Abe took office three years ago and initiated a recovery strategy that relies heavily on monetary stimulus. But investment and wages have lagged expectations, slowing growth.

A recent upward revision of data showed Japan's economy steered clear of recession, despite a contraction in April-June, as the economy gathered momentum in July-September.

"Admittedly, firms project a sharp weakening in business conditions in the coming quarter, but this is not unusual when current circumstances are as buoyant as they are now," Marcel Thieliant of Capital Economics said in a research note.

While stronger demand for exports helped, a build-up in inventories also contributed to the uptick in growth. That would be a plus if consumer demand rises to meet the increased output.

However, the tankan survey shows firms judging supplies of goods exceeding demand in almost all categories, despite very tight capacity and labour supplies.



Advertisements

Latest Economic News

  • Think tank urges Liberals to sell money-making assets to private sector

    Economic CTV News
    OTTAWA -- A new report is urging the Trudeau Liberals to make their new, experimental infrastructure bank a centre for helping cities and provinces sell off existing assets, rather than just helping to build new infrastructure. Source
  • Asian markets mostly higher after Wall Street sinks

    Economic CTV News
    BEIJING -- Asian stock markets rose Tuesday after Wall Street sank on worries that the Trump administration might not do as much for businesses as once thought. KEEPING SCORE: Tokyo's Nikkei 225 gained 1 per cent to 19,174.56 and Hong Kong's Hang Seng advanced 0.5 per cent to 24,317.93. Source
  • American Airlines buys stake in China Southern Airlines

    Economic CTV News
    BEIJING -- American Airlines has agreed to pay US$200 million for a stake in China Southern Airlines, one of China's three major state-owned carriers, in a bid for a bigger share of the country's growing travel market. Source
  • Sask. city pays Domtar $5.1M over tax assessment dispute

    Economic CTV News
    PRINCE ALBERT, Sask. - City council in Prince Albert, Sask., has authorized a $5.1 settlement with Domtar in a tax dispute over the valuation of a pulp mill Domtar purchased from Weyerhaeuser in 2006. Domtar had argued the assessment of its property was too high for 2009 and 2010 and requested a refund. Source
  • Ontario promises housing affordability measures in the spring budget

    Economic CTV News
    TORONTO -- Ontario Finance Minister Charles Sousa confirmed Monday he plans to include housing affordability measures in his upcoming budget. Premier Kathleen Wynne has said her government is working on a "comprehensive set of plans," to deal with rising home prices in the Greater Toronto and Hamilton Area (GTHA), as well as rising rental rates. Source
  • Home Capital terminates CEO Martin Reid

    Economic CBC News
    Home Capital Group Inc. has terminated its president and CEO Martin K. Reid, effective immediately. Kevin P.D. Smith, chair of the board of directors, said in a statement Monday that the Toronto-based mortgage lender requires leadership that can bring a renewed operational discipline, emphasis on risk management and controls, and focus on improving performance. Source
  • B.C. First Nation gives nod to proposed LNG export facility

    Economic CTV News
    VANCOUVER -- A First Nation on Vancouver Island has approved a proposed liquefied natural gas export facility on its traditional territories. Leaders of the Huu-ay-aht First Nation and the CEO of Vancouver-based Steelhead LNG held a joint news conference in Vancouver on Monday to announce what Chief Robert Dennis said was the First Nation's "official entry into the international business world. Source
  • Officials gear up to assign infrastructure cash or lose control over its spending

    Economic CTV News
    OTTAWA - Provincial governments have been warned that they have until this time next year to start assigning billions in infrastructure cash to eligible projects, or else they could lose control over how it can be spent. Source
  • B.C. appeal court rules against Burnaby in bylaw battle with Trans Mountain

    Economic CTV News
    VANCOUVER -- A legal battle between the City of Burnaby and the Trans Mountain pipeline expansion has ended with the British Columbia Court of Appeal ruling the National Energy Board can override municipal bylaws. The fight began in 2014 when Trans Mountain was set to begin field studies on Burnaby Mountain, which required it to cut down trees, drill boreholes and operate heavy machinery -- activities that violate the city's bylaws. Source
  • Finance minister to tout Canada-U.S. trade to U.S. governors and mayors

    Economic CTV News
    CALGARY -- Canada's finance minister says he intends to head south of the border next week to reinforce the importance of Canada-U.S. trade. "Our approach was to be deeply engaged with the new administration from Day 1 . Source