(MENAFN- Kuwait News Agency (KUNA)) Business confidence among major Japanese manufacturers in the July-September period worsened from the previous three months, marking the first decline in three quarters, the Bank of Japan (BOJ) said Thursday.
The central bank's quarterly survey showed the business sentiment index among big makers in the world's third-largest economy dropped to plus 12 points, compared with plus 15 points in the June poll. The BOJ attributed the deterioration to weak exports and production amid the slowdown in China and emerging economies.
The index represents the percentage of companies which are positive about their business minus the percentage of those who gave negative replies. Thus, a positive number means optimists outnumber pessimists. The central bank's "tankan," which means short-term economic outlook, is Japan's most closely watched index of business confidence. But confidence among large retailers, banks, real estate companies and other non-manufacturers gained 2 points to plus 25 for the fourth straight quarter of improvement, thanks to strong sentiment by accommodations, food and beverage service sectors on the back of increasing foreign visitors. The index marked the highest level since November 1991.
The survey also showed that big firms in both manufacturing and non-manufacturing sectors plan to boost capital spending by 10.9 percent t in fiscal 2015 through next March 31 from the previous year, up from the 9.3 percent gain in the June survey. Looking ahead, large manufacturers expect their sentiment index to further deteriorate to plus 10 in the next survey in December, while large non-manufacturers predict the index will fall to plus 19, reflecting concern over the economic slowdown in China and emerging countries.
The latest survey was conducted between Aug. 26 and Sept. 30, covering 11,017 companies, of which 99.5 percent responded. The report came as Japan's economy contracted at an annual 1.2 percent pace the April-June period the first decline in three quarters, due to a slump in exports and personal consumption.
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