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

  • Rising old age security spending dampened by CPP increases: report

    Economic CBC News
    A mandatory review of the country's largest seniors benefit program is predicting all-time highs in spending over the coming years with waves of baby boomer retirements — spending levels that could have been even higher if not for changes to the public pension program. Source
  • Calgary airport to convert Lexus-only stalls back to accessible parking

    Economic CTV News
    Calgary International Airport has apologized for moving accessible parking stalls and setting up a Lexus marketing campaign in their place. The pavement in the parking spots was painted to indicate they were reserved for drivers of the luxury car. Source
  • Rowdy Korean Air passenger's 3-year prison sentence reversed

    Economic CTV News
    HAGATNA, Guam -- A U.S. appeals court has struck down the three-year prison sentence of a rowdy Korean Air passenger convicted of interfering with flight attendants last year on a flight to Guam. The 9th U.S. Source
  • Striking ground crew at Toronto airport to vote on new offer from employer

    Economic CTV News
    TORONTO - The union representing striking ground crew workers at Canada's busiest airport says it has received a new contract offer that will be voted on tomorrow. About 700 baggage handlers, cabin cleaners, and other ground crew employed by Swissport at Toronto's Pearson International Airport have been on strike since late July. Source
  • June retail sales a bright spot for Canadian economy: economists

    Economic CTV News
    OTTAWA - Canadian retail sales rose slightly in June and continue to be a bright spot in the economy. Statistics Canada says in a report issued Tuesday that the retail sector's growth was 1.1 per cent, excluding automotive and gasoline sales. Source
  • CGI Group moves to expand in northern Europe with takeover of Affecto

    Economic CBC News
    Canada's largest publicly traded IT services business is moving to expand its presence in Europe through the acquisition of Affecto PLC in a friendly deal that would add about 1,000 staff in northern Europe. CGI Group Inc. Source
  • Big banks set to reveal profits this week against the backdrop of improving economy

    Economic CBC News
    Canada's biggest banks could deliver another profitable season for investors as third-quarter results starting to roll in this week are expected to get a boost from the strengthening economy. Analysts expect modest improvements from the Big Six banks, which launch their quarterly earnings reports beginning with Royal Bank on Wednesday, but some suggest the industry could outdo the conservative predictions. Source
  • BHP Billiton puts brakes on Jansen potash mine

    Economic CBC News
    BHP Billiton won't be asking its board to build the Jansen potash project any time soon. In its year-end financial results, the global resource company says it won't be asking the board for approval to go ahead with the Jansen potash project in 2018. Source
  • EU probes Bayer's planned buyout of Monsanto

    Economic CTV News
    BRUSSELS -- The European Union's anti-trust watchdog said Tuesday that it has launched a probe into German chemical maker Bayer's planned acquisition of U.S. seed and weed-killer company Monsanto.. The European Commission, which polices competition in Europe, said Tuesday it has concerns that the merger may reduce competition in areas like pesticides and seeds. Source
  • Retail sales inch higher to $49B in June

    Economic CBC News
    Sales at clothing stores increased in June, Statistics Canada reported Tuesday. (Shannon Stapleton/Reuters) Canadian retailers reported higher sales for the fourth straight month in June, as just about everything except cars and gasoline stations saw higher sales. Source