By Megumi Fujikawa
TOKYO--Large Japanese companies became more optimistic about business conditions in the past quarter despite uncertainties over the Middle East conflict and energy supplies.
Wednesday's release of the Bank of Japan's tankan survey showed that the index measuring sentiment among large manufacturers was +22, up from +17 in the March reading and beating the +16 expected in a poll of economists by data provider Quick.
That marks the highest level since March 2018, which is all the more surprising as the closely watched survey likely doesn't fully reflect firms' views on the recent progress toward ending hostilities between the U.S. and Iran.
The tankan gauge represents the percentage of companies that said business conditions were favorable minus those that said conditions were unfavorable.
Sentiment among some sectors, including petroleum product makers, did turn more cautious amid supply fears and surging energy prices, but with oil and gas normalizing recently, that could change.
Even without factoring in the latest peace talk developments, the survey showed that geopolitical risks haven't completely ruined Japan Inc.'s mood. Large firms plan to increase capital expenditure by 11.5% in the current business year, compared with the 3.3% rise planned in the previous survey.
Write to Megumi Fujikawa at megumi.fujikawa@wsj.com
(00:48 GMT) Japanese Manufacturers Turn More Optimistic Despite Middle East Uncertainty
By Megumi Fujikawa
TOKYO--Large Japanese companies became more optimistic about business conditions in the past quarter despite uncertainties over the Middle East conflict and energy supplies.
Wednesday's release of the Bank of Japan's tankan survey showed that the index measuring sentiment among large manufacturers was +22, up from +17 in the March reading and beating the +16 expected in a poll of economists by data provider Quick.
That marks the highest level since March 2018, which is all the more surprising as the closely watched survey likely doesn't fully reflect firms' views on the recent progress toward ending hostilities between the U.S. and Iran.
The tankan gauge represents the percentage of companies that said business conditions were favorable minus those that said conditions were unfavorable.
Sentiment among some sectors, including petroleum product makers, did turn more cautious amid supply fears and surging energy prices, but with oil and gas normalizing recently, that could change.
Even without factoring in the latest peace talk developments, the survey showed that geopolitical risks haven't completely ruined Japan Inc.'s mood. Large firms plan to increase capital expenditure by 11.5% in the current business year, compared with the 3.3% rise planned in the previous survey.
Write to Megumi Fujikawa at megumi.fujikawa@wsj.com