Bank Of Japan Tankan Survey Shows Business Confidence Holding Steady, Easing Pressure On Policymakers
Press Telegraph – December 22, 2015 – It was discovered by a closely-watched survey by the central bank which offered a dash of relief to the policymakers who are anxious about uncertainties globally which could weaken corporate spending. The indexes are derived by subtracting the number of respondents who say conditions are poor from those who say they are good. A positive reading indicates that optimists outnumber pessimists.
However, the business outlook DI toward March worsened for both large manufacturers and large nonmanufacturers, showing that Japanese companies are casting cautious eyes about their upcoming business environment partly due to uncertainty over the course of the Chinese economy.
According to the latest figures, companies here expect consumer prices to increase one percent next year, less than the 1.2 percent expected in a survey taken three months earlier, Xinhua reported.
The headline index for big manufacturers’ sentiment stood at plus 12 in December, unchanged from three months ago, the survey showed.
Companies also cut their sales price forecast for all of the timeframes, in a move that appears to contradict the BOJ’s assessment that managers have grown more bullish about raising prices.
Despite Japan being mired in deflation for more than two decades, the central bank, under pressure from Prime Minister Shinzo Abe and the Finance Ministry, also working towards the leader’s economic policy goals, is attempting to achieve its inflation target through aggressive monetary easing measures.
“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.