Japanese manufacturers remained close to the most pessimistic they have been in 11 years in July as the coronavirus outbreak hits global demand and deals a punishing blow to the export-reliant economy, the Reuters tankan survey showed on Wednesday.
FILE PHOTO: An employee of Sanko Manufacturing Co. conducts shipping of the company's ventilators as the spread of the coronavirus disease continues in Saitama north of Tokyo, Japan May 8, 2020. REUTERS/Issei Kato
The Reuters Tankan index readings are derived by subtracting the percentage of respondents who say conditions are poor from those who say they are good. A negative reading means that pessimists outnumber optimists. The survey showed manufacturers’ sentiment in October at minus 32 and that of service-sector firms at minus 16 as some respondents, such as a metals maker, saw a bottoming out in the auto sector, suggesting stronger demand ahead.
The central bank may slightly cut its growth forecast for the current year to March 2021, but is expected to hold on to its view Japan is headed for a moderate recovery later this year as the virus crisis subsides.
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