By Tetsushi Kajimoto
TOKYO (Reuters) – Sentiment at big Japanese manufacturers surged, improving for a second straight month as the auto sector continued to recover from last year’s semiconductor shortage and supply chain woes, a monthly Reuters Tankan survey found.
The sentiment index for manufacturers stood at plus 12 in December compared with plus 6 the previous month, according to the survey which was conducted Nov. 21-Dec. 1.
“As chip shortages eased, car production grew. But on the other hand, the worsening state of China’s economy and sluggish sales of Japanese vehicles in the Chinese market remain sources of concern,” a manager at a textile manufacturer wrote in the comment section of the survey.
The result is likely to reinforce expectations that Japan’s economy is bottoming out after contracting by a preliminary annualised rate of 2.1% in the July-September quarter. Economists believe the economy will show moderate growth in the current quarter, also helped by a pick-up in capital expenditure.
The poll also showed the service sector index at plus 26, down from plus 27 in November.
The index readings are calculated by subtracting the percentage of pessimistic respondents from optimistic ones, with a positive figure indicating optimists outnumber pessimists.
Reuters’ monthly poll serves as a leading indicator for the Bank of Japan’s closely watched quarterly tankan survey due next at 2350 GMT Dec. 12.
Compared with three months earlier, the manufacturers’ index was 8 points higher and the service sector index was up 3 points, the Reuters poll showed.
But looking ahead to the next quarter, the mood was not as upbeat and the manufacturers’ index for March was seen falling to plus 8 while the service sector index was seen at plus 24.
Some 240 firms responded to the survey of 501 large companies on condition of anonymity.
(Reporting by Tetsushi Kajimoto; Editing by Edwina Gibbs)