Survey Reveals Varied Business Outlook Among Major Japanese Corporations
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Tokyo, Dec 13 (NationPress) The latest survey from the Bank of Japan (BOJ), published on Friday, has uncovered varied business sentiment among Japan's large corporations. Manufacturers are showing signs of recovery, whereas non-manufacturers are encountering substantial challenges.
The business index for large manufacturers saw an improvement for the first time in two quarters, increasing by 1 point to plus 14 for the period of October to December, as per the quarterly Tankan survey conducted by the Bank of Japan.
A positive index indicates that a greater number of firms are optimistic about business conditions compared to those who are pessimistic, as reported by Xinhua news agency.
This growth is attributed to a rebound in automotive production, which had previously suffered due to certification challenges, alongside heightened demand for semiconductor manufacturing equipment spurred by advancements in artificial intelligence.
However, despite these positive trends, large non-manufacturers experienced a slight reduction in sentiment, with the business index dropping to plus 33 from plus 34 in the prior quarter, marking the first decline in two quarters.
Retail sentiment fell sharply, reflecting diminished demand for fall and winter apparel following prolonged late-summer weather.
Additionally, the accommodation and food services sector also reported a decline in sentiment, despite a boost from strong inbound tourism, primarily due to rising labor costs and increased material prices.
Looking ahead, the index for large manufacturers is projected to decrease by 1 point to plus 13 over the next three months, indicating cautious sentiment amid concerns about dwindling overseas demand and potential policy shifts under US President-elect Donald Trump.
Trump has recently threatened to impose tariffs on imports from significant US trading partners.
This situation may lead to adjustments in US consumers' behavior as the holiday season unfolds and the new year approaches, influenced by potential new tariffs. Consumer adjustments will vary based on the item and costs, shaped by the current external environment.
US holiday spending in the final two months of 2024 is forecasted to reach unprecedented levels, expected to increase between 2.5 percent and 3.5 percent over 2023, totaling between $979.5 billion and $989 billion, according to projections by the NRF.
