Japan Big Maker Sentiment Improves for 3rd Straight Quarter

Tokyo, Dec. 15 (Jiji Press)–Business sentiment among large manufacturers in Japan improved for the third straight quarter, apparently because the impacts from the high tariff policy of U.S. President Donald Trump’s administration proved to be limited, the Bank of Japan’s “tankan” survey for December showed Monday. The headline diffusion index for large manufacturers’ current business conditions rose to plus 15 from plus 14 in the previous September survey, hitting the highest level since December 2021. The latest reading matched the average forecast among 16 economic research institutes surveyed by Jiji Press. The outcome is expected to be a tailwind for the BOJ, which is reportedly considering raising its policy interest rate at its two-day Policy Board meeting from Thursday. The continued rise in the most closely watched index in the central bank survey also reflected robust demand for semiconductors on the back of the expanding use of generative artificial intelligence as well as progress in companies’ efforts to pass higher costs on to their product prices. The result showed that the Japanese economy remains on a path of moderate recovery, analysts said. The DI shows the percentage of companies seeing good business conditions minus that of firms feeling the opposite. The current condition DI for the automotive industry came to plus 9, down from plus 10 in the previous September tankan, as the sector still remains cautious about the effects of the U.S. tariff policy. In contrast, the DI for the petroleum and coal product sector significantly improved to plus 33 from zero, thanks to receding uncertainty in the global economy from Trump’s tariffs. END [Copyright The Jiji Press, Ltd.]