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Dow Jones NewsDec 15, 12:38 AM UTC
Japan Manufacturers' Mood Brightens, Backing Rate-Hike Case
By Megumi Fujikawa
TOKYO--A key gauge of business sentiment in Japan improved for the third straight quarter as trade anxiety eased, reinforcing hopes that the central bank will soon resume raising rates.
The Bank of Japan's tankan corporate survey showed that major manufacturers have remained upbeat following the Tokyo-Washington trade deal, which cleared some of the tariff uncertainty that muddied earnings outlooks and investment plans.
The main index measuring sentiment among large manufacturers was +15 in the survey released Monday. That compared with the +14 reading in the September reading and the +15 expected in a poll of economists by data provider Quick.
The gauge represents the percentage of companies that said business conditions were favorable minus those that said conditions were unfavorable.
Solid tankan results will likely reinforce the case for the BOJ to resume monetary tightening at its meeting ending Friday.
Markets have almost fully priced in a December rate increase after BOJ Gov. Kazuo Ueda said earlier this month that the bank would consider pros and cons of a rate hike at the next meeting. Other economic indicators signal that inflation-wage dynamics are conducive to monetary tightening.
Although trade concerns have eased, Japan Inc. still faces higher tariffs than it did last year. BOJ policymakers have been closely monitoring the impact of U.S. trade policy on companies' investment plans to assess the health of Japan's corporate sector.
Monday's data showed that large Japanese companies plan to increase capital expenditure by 12.6% in the fiscal year ending March 2026, compared with the 12.5% increase planned in the previous survey.
Write to Megumi Fujikawa at megumi.fujikawa@wsj.com
(END) Dow Jones Newswires
December 14, 2025 19:38 ET (00:38 GMT)
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