Confidence among Japan’s biggest manufacturers has risen for the second straight quarter, a key central bank survey showed Monday, as companies forecast a weaker yen.
The Bank of Japan’s Tankan report — a quarterly survey of more than 10,000 companies that is the broadest indicator of how Japan Inc is faring — showed a reading of 12 among major manufacturers, rising from 10 in the previous survey.
That is the strongest level since the same reading for the final quarter of 2015 report but fell short of the median forecast of 14 in a survey by Bloomberg News.
The average predicted exchange rate by large manufacturers for the fiscal year that ended last month was 107.30 yen, which is weaker than the 104.90 yen forecast in the previous report.
The rate is what companies use internally for business planning and often deviates from current market exchange rates.
A weaker yen is positive for Japanese exporters as it makes their products more competitive abroad and inflates repatriated profits.
Confidence among small- and mid-sized firms also strengthened in the latest survey.
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