Quarterly ‘tankan’ survey shows slight improvement as Bank of Japan weighs a rate hike
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Article contentA quarterly survey of major Japanese manufacturers released Monday shows business sentiment improving to its best level in four years, even after President Trump raised tariffs on goods from the U.S. ally to a baseline level of 15%.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentThe Bank of Japan is bound to take the results of its quarterly “tankan” survey into account during a policy meeting this week, when it is expected to raise its benchmark interest rate. Analysts said the stronger results may sway the BOJ toward pressing ahead with a 0.25 percentage point rate hike that will take the key rate to 0.75%.Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle contentThat expectation hit the price of bitcoin early Monday, as it dipped below $88,000 from about $92,000. Higher rates would likely lead Japanese investors to shift funds back home, sapping demand for cryptocurrencies.Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article contentWhile the U.S. Federal Reserve has been trimming rates to counter a weak jobs market, Japan’s central bank is moving in the other direction as it contends with inflation and a weak currency. The economy contracted at an annualized rate of 2.3% in July-September.Article contentStill, the BOJ survey showed the measure of major manufacturers expressing optimism rose to 15 from 14 in the last quarter, the highest level in four years. The index shows the percentage of companies reporting positive conditions minus the percentage reporting unfavorable ones.Article contentThe measure of sentiment for all companies rose to 17 from 15, it said.Article contentThe survey “struck all the right notes from the Bank of Japan’s perspective,” Abhijit Surya of Capital Economics said in a report. “It showed that business conditions are improving, profit margins remain elevated and firms are upbeat about their investment intentions.”Article contentArticle contentThe latest deal between Japan and the Trump administration set tariffs on its exports to the U.S. at 15%, down from an earlier plan for a 25% tariff. To win the agreement, among other things Japan promised to invest $550 billion in the United States.Article contentWhile the BOJ’s overall survey showed improvement, forecasts for the next quarter were less positive, and businesses expected inflation to remain at 2.4%, above the central bank’s target range.Article contentThe Bank of Japan has kept its key interest rate near or below zero for years, trying to spur faster economic growth by keeping borrowing costs very low.Article contentIts policymaking has been complicated by the fact that Japan’s population is shrinking and aging rapidly. That has caused labor shortages that have only slowly pushed wages higher. That should lead consumers to spend more, but increases in income have lagged behind inflation, denting their appetite for spending.Article contentPrime Minister Sanae Takaichi has pledged, as have her predecessors, to revive the economy. Last month, her cabinet approved a 21.3 trillion yen ($135.4 billion) stimulus package to spur growth through expansionary government spending and relieve the impact of higher prices.Article contentTrending 'Why let one person in the States change your life?' For Canadian snowbirds, the stay or go dilemma gets complicated Real Estate Charles St-Arnaud: Canada must stop relying on consumers and focus on production to boost the economy Economy Canada's Air Force buys six Bombardier jets for $753 million News Canada to start building multi-billion dollar high-speed rail system by 2030 Rail Howard Levitt: Why remote workers keep winning in employment law disputes Work Share this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. 'Why let one person in the States change your life?' For Canadian snowbirds, the stay or go dilemma gets complicated Real Estate Charles St-Arnaud: Canada must stop relying on consumers and focus on production to boost the economy Economy Canada's Air Force buys six Bombardier jets for $753 million News Canada to start building multi-billion dollar high-speed rail system by 2030 Rail Howard Levitt: Why remote workers keep winning in employment law disputes Work