Positive sign for Japan’s economy

tokyo — Confidence among Japanese manufacturers held firm in December and servicesector sentiment rose for a second straight month, the Reuters Tankan poll showed on Thursday, underscoring steady economic growth driven by both external and domestic demand.

The monthly poll, which tracks the Bank of Japan’s closely-watched tankan quarterly survey, found manufacturers’ mood up a tad from three months ago and service-sector morale holding steady, signalling a firm reading in the upcoming BoJ tankan.

Solid tankan results should be encouraging for the BoJ, which will scrutinise the survey readings, due on December 15, at its policy meeting later this month.

“Sentiment in both manufacturing and non-manufacturing remained elevated and that the outlook was also firm, reflecting strong domestic and overseas demand,” said Yuicihro Nagai, economist at Barclays Securities. “We expect the BoJ tankan index for large manufacturers to rise by one point to 23 in December, while the index for large nonmanufacturers holds at 23.”

In the poll of 547 large- and mid-sized firms, in which 251 responded, the manufacturers’ index was seen inching up in March while the service-sector mood was believed likely to slip but remain at relatively high levels.

“Following growing interest in artificial intelligence and the Internet of Things, we are receiving increasing inquiries from manufacturers about automation and efficiency,” an electrical equipment maker wrote in the survey. —