Japanese Business Confidence Down, Survey Shows

Japanese manufacturers are wary of the country's economic prospects, according to a leading survey measuring business sentiment. Outlook for the coming quarter is 'not so favorable' in the world's third-largest economy.



Business confidence among Japan's major manufacturers was marginally lower in the past three months, a quarterly central bank survey showed Monday.



The closely-watched Bank of Japan's Tankan survey fell by one point to plus 12 in the three months to December, indicating overall expectations among manufacturers had deteriorated.



But business sentiment rose among non-manufacturing companies to plus 16 from plus 13, showing a mixed outlook for the world's third largest economy.



"Today's Tankan survey suggests that Japan's economy stabilized in the fourth quarter, but a rapid recovery is not in the cards," said Marcel Thieliant, Japan's economist at Capital Economics.



The results of the survey come amid Prime Minister Shinzo Abe's landslide election victory Sunday. His government is considering a supplementary budget of up to 3 trillion yen ($25.3 billion, 20.3 billion euros) to revive the economy, local media reported.







Japanese businesses anticipate weak demand both at home and abroad for their output amid a weakening Japanese yen. After a sales tax hike in April, the country unexpectedly fell into recession - the third time in four years.



This month, international ratings agency Moody's also cut Japan's credit rating due to the country's spiraling debt.



Japan's Nikkei share average dropped 1.6 percent Monday, as oil prices sank to a new five-year low.



el/uhe (AFP, AP, dpa, Reuters)