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The BOJ released on Friday results of survey about business confidence. The results signalled that confidence had sharply fell in Q1 2016. It is another sign of abenomics’ weakness on the background of non-domestic impacts and global economic slowdown.
Tankan large manufacturers index fell by 6 bp to 6.0 from December. The report shows that confidence has fallen in different sectors of manufacturing, despite new economic stimulation and negative deposit rates.
The survey that includes answers of more than 10,000 representatives of private business became the last indicator that signals about weakness of abenomics.
Japan’s economy suffered difficulties in Q1 after significant reduction in Q3 2015. Consumption and export remain weak. Inflation is also quite low and it won’t rise because of slow growth of wages on the background of stronger yen and weak global economy.
Tankan large non-manufacturers index fell also by 3bp to 22.0. It is the first fall of index for the last six quarters.
Besides, results of this survey show that members of large business are going to cut their investments by 0.9% in new fiscal year. They follow the traditions, when Japanese companies start new fiscal year conservatively.
Japanese companies revised their investments from 1.0% to 9.8% during the previous fiscal year. According to their expectations, possible income may fall in new fiscal year by 2% after growth by 3.9% in the previous fiscal year.