Tankan Supports View for Faster-than-Before BOJ Rate Hikes

Dow Jones
Yesterday

0225 GMT - Solid results of the Bank of Japan's Tankan survey support the possibility of a faster-than-before rate-hike cycle, says Mizuho Securities economist Ryosuke Katagi. The headline index measuring sentiment among large manufacturers reached the highest level since March 2018. "Aside from business sentiment, a notable feature was the strong outlook for current profits, particularly among manufacturers," he says. "Robust demand related to semiconductors and AI may be driving these strong projections." Strong profit forecasts could feed positively into next spring's wage negotiations. Current profit projections across all industries and company sizes for fiscal 2026 were raised to a 2.2% increase, compared with a 6.5% decline projected in the June survey, according to Thursday's Tankan survey.

 

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