TOKYO, May 24 (Reuters) – Business sentiment among major Japanese manufacturers turned positive for the first time this year and morale in the services sector reached a five-month high, Reuters’ Tankan survey found, as the economy continued to improve after a COVID-19 crisis. led recession.
Wednesday’s monthly poll, which follows the Bank of Japan’s closely monitored tankan survey, found that manufacturers are also optimistic about the next three months, while morale in the services sector dipped a bit.
The solid reading may further fuel speculation that the BOJ will start normalizing its easing policies sooner rather than later. However, Governor Kazuo Ueda has repeatedly said that inflation, supported by wage increases, must follow a sustainable rate of 2% before the bank can consider an exit.
“Governor Ueda’s cautious stance on the global economy, it still takes time for the BOJ to start normalizing monetary policy,” said Yoshimasa Maruyama, chief market economist at SMBC Nikko Securities.
“Sentiment from major manufacturers rose on improvements in the auto industry and is likely to remain positive, although the pace of recovery will be moderate.”
The sentiment index for major manufacturers reached +6, up from April, the survey found of 493 companies, 241 of which responded between May 10 and 19.
It was the first positive measurement this year and will rise further in August.
Automakers and oil refiners were among those reporting positive responses as supply chain bottlenecks eased.
“As daily life normalizes in the wake of the pandemic, shopper appetite has increased, driving double-digit sales for department stores in urban areas,” a retailer manager wrote.
However, many others complained about the cost of doing business, due to the still high global inflation of goods and services.
“Weak yen and elevated crude oil drove up the cost of everything from raw materials to services, hurting consumption,” the manager of a food processing company wrote.
The services sector index rose slightly from April to 25, its highest level this year, led by retailers and real estate and construction companies.
The world’s third-largest economy emerged from recession in January-March as a recovery in post-COVID consumption offset global headwinds, offering hope for domestic demand-led growth.
Last month, the BOJ’s tankan showed that producer sentiment soured in January-March to the worst in more than two years.
The sentiment survey indices are calculated by subtracting the percentage of pessimistic respondents from optimistic respondents. A positive number means there are more optimists than pessimists.
Reporting by Tetsushi Kajimoto Edited by Shri Navaratnam