Japan's large manufacturing confidence hit a 11-year high in the fourth quarter

A Bank of Japan survey found that the fourth quarter Japan's large manufacturing companies confidence improved for the fifth consecutive quarter, showing that export and corporate profits are giving the economy momentum.

Data Photo: August 2016, Japan Hamamatsu, starter assembly line for Honda car transmission plant. REUTERS / Kim Kyung-Hoon
The data may make the Bank of Japan more reason to believe that the strengthening economic recovery will enable businesses to raise wages. It would also allow the central bank to slightly withdraw its crisis-style stimulus even before inflation reached the 2% target.

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The Bank of Japan's closely watched "short-sighted" survey showed on Friday that the big manufacturing sentiment index for December was positive 25, above the market consensus median of 24, and the September 2009 reading was positive22.

This figure is in line with the high of December 2006.

The large non-manufacturing climate index for December was positive 23, unchanged from September and consistent with the Reuters median estimate.

"The short-term survey supports the Bank of Japan's optimistic economic assessment in the context of the global economic recovery, but also shows that private consumption is weak and the economy of restaurants, hotels and other service industries has worsened." The Mizuho Research Institute's Economic Investigation Department Director Takada Hideyoshi said.

 

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