Bank of Japan September quarter 2024 Tankan report, main findings:
- September big manufacturers index +13 (expected 13)
- December big manufacturers index seen at +14 (expected 12)
- September big non-manufacturers index +34 (expected 32)
- December big non-manufacturers index seen at +28 (expected 30)
- September small manufacturers index 0 (expected -2)
- December small manufacturers index seen at 0 (expected -3)
- September small non-manufacturers index +14 (expected 11)
- December small non-manufacturers index seen at +11 (expected 9)
- Japan all firms see dollar averaging 145.15 yen for FY2024/25
- Japan all firms see euro averaging 157.07 yen for FY2024/25
- Japan big manufacturers see FY2024/25 recurring profits -7.0%
- September all firms employment index -36
- September all firms financial condition index +12 vs June +12
- September big manufacturers’ production capacity index +2 vs June
+3 - Japan big firms see FY2024/25 capex +10.6% (expected 11.9%)
- Japan small firms see FY2024/25 capex +2.6% (expected 2.8%)
- Japan big manufacturers see dollar averaging 144.96 yen for
FY2024/25
These results paint generally positive expectations for Japan’s economy. There doesn’t seem much here to divert the BOJ from its slow hiking course.
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The term “Tankan” is short for “Tanshin Kansoku,” which roughly translates to “Short-term Economic Observation”.
- its published quarterly by the BOJ and is a closely watched economic indicator
- the BoJ surveys thousands of Japanese firms of all sizes, across a wide range of industries
- questions are focused on firms’ current business conditions and their expectations for the coming quarter and year
- covering aspects such as production, sales, profits, investment in plant and equipment, employment, prices, and more
The headline(s) to to the report are diffusion indexes, which reflects the difference between the percentage of firms that are optimistic about business conditions and those that are pessimistic.
- a positive reading suggests that more companies are optimistic, while a negative reading indicates more pessimism
The report is segmented into “large manufacturers,” “large non-manufacturers,” “small manufacturers,” and “small non-manufacturers” so as to help provide insight into different sectors of the economy.