TOKYO (AP) 鈥� Business sentiment among major Japanese manufacturers rose to 17 in March from 16, according to the released Wednesday.
The improvement in the key so-called diffusion index in the closely watched 鈥渢ankan鈥� report, recorded for the fourth quarter straight, comes even as worries grow about Japan鈥檚 economic growth and oil supplies because of .
The survey is an indicator of companies foreseeing good conditions minus those feeling pessimistic.
The index for large non-manufacturers, such as the service sector, stood unchanged from the last tankan at 36.
Japan鈥檚 inflation has so far remained relatively moderate, but worries are growing about prices at the gas stands and other products. Investors and consumers alike are filled with uncertainty about how much longer the war may last and what U.S. might say next. Japan鈥檚 benchmark Nikkei 225 has gyrated wildly in recent weeks.
Analysts say the Bank of Japan may start to raise interest rates because of concerns about inflation, given the soaring energy costs and declining yen 鈥� two elements that greatly affect living costs for the average Japanese consumer.
Historically, Japan has benefited from a weak yen because of its giant exports, exemplified in autos and electronics. A weak yen raises the value of exports鈥� earnings when converted into yen.
But in recent years, a weak yen is working as a negative, as resource-poor Japan imports much of its energy, as well as other key products such as food and manufacturing components.
The U.S. dollar has been soaring against the yen lately.
Japan鈥檚 central bank had a negative interest rate policy for years to fight deflation until . It kept the rate unchanged at 0.75% in March. The next Bank of Japan monetary policy board meeting is set for April 27 and 28.
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Yuri Kageyama is on Threads:
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