Japan Economy Watcher Sentiment Falls to 4-Year Low in March

Tokyo, April 8 (Jiji Press)–Sentiment among so-called economy watchers in Japan fell to the lowest level in about four years in March, reflecting tensions over Iran, a Cabinet Office survey showed Wednesday. The seasonally adjusted diffusion index that shows the current sentiment of economy watchers, or people working in industries sensitive to changes in economic trends, stood at 42.2, down 6.7 points from February. This is the lowest level since the reading of 37.7 in February 2022, when Russia started its invasion of Ukraine and the world was in the COVID-19 pandemic. Summing up the latest result, the Cabinet Office said that economy watchers believe weakness is seen in the recent pickup of the economy, weaker than the assessment in February that the economy was picking up. For the outlook, the economy watchers think that there is uncertainty due to the Middle East tensions, the government agency said. All three underlying indicators on households, corporate activities and employment declined. A worker at a restaurant in the southern part of the Kanto eastern region said, “I get the feeling that people are refraining from going out due to gasoline price hikes” caused by difficulties related to crude oil procurement following the de facto blockade of the Strait of Hormuz by Iran. An employee of a real estate company in the northern part of Kanto said, “Higher costs reflecting rapid hikes in material and fuel prices are squeezing profits.” The outlook DI among the economy watchers two to three months ahead came to 38.7, the lowest level since December 2020. Concerns were voiced over possible declines in tourism demand and the impact of the uncertain global situation on hiring. END [Copyright The Jiji Press, Ltd.]