ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintIcon Twitter
Economy

Japan's business mood darkened in Q3: BOJ survey

Weaker yen and inflation undermined economic recovery

The country's big manufacturers expect business conditions to improve three months ahead, while big non-manufacturers' sentiment is seen worsening, the BOJ's Tankan survey showed.   © Reuters

TOKYO (Reuters) -- Japanese manufacturers' business mood worsened in the three months to September, a central bank survey showed on Monday, bolstering views that the weakening yen and its inflationary impact on business costs undermined a fragile economic recovery.

Adding to the gloom, fears of a global economic slowdown cloud the outlook for the export-reliant economy, which is still just emerging from the coronavirus pandemic.

Service-sector sentiment brightened a tad from three months ago, the Bank of Japan's "tankan" survey showed, although retailers were less optimistic due to the rising cost of living blamed on higher commodity prices and the boost to import prices from the yen's declines.

The headline index for big manufacturers worsened to plus 8 in September from plus 9 in June, the quarterly survey showed, compared with a median market forecast for plus 11.

The big non-manufacturers' index stood at plus 14 in September, up from plus 13. This compared with a median market forecast for plus 13.

The country's big manufacturers expect business conditions to improve three months ahead, while big non-manufacturers' sentiment is seen worsening, the survey showed.

Japan's economy expanded an annualized 3.5% in the second quarter as the lifting of COVID-19 restrictions boosted consumption. But many analysts expect growth to have slowed in the third quarter, as slowing global demand and rising raw material prices weigh on exports and consumption.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

Discover the all new Nikkei Asia app

  • Take your reading anywhere with offline reading functions
  • Never miss a story with breaking news alerts
  • Customize your reading experience

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more