Japan big manufacturers' mood worsens slightly in Q4

Japanese big manufacturers'sentiment worsened slightly in the three months to December but corporate spending plans were strong, the Bank of Japan's closely watched tankan survey showed, highlighting the uneven recovery brought by premier Shinzo Abe'
Japanese big manufacturers'sentiment worsened slightly in the three months to December but corporate spending plans were strong, the Bank of Japan's closely watched tankan survey showed, highlighting the uneven recovery brought by premier Shinzo Abe's stimulus policies. -- PHOTO: REUTERS

TOKYO (Reuters) - Japanese big manufacturers'sentiment worsened slightly in the three months to December but corporate spending plans were strong, the Bank of Japan's closely watched tankan survey showed, highlighting the uneven recovery brought by premier Shinzo Abe's stimulus policies.

The headline index for big manufacturers' sentiment worsened by 1 point from three months earlier to plus 12 in December, the Bank of Japan's quarterly "tankan" survey showed on Monday. That compared with a median market forecast of plus 13.

Big firms plan to increase capital spending by 8.9 per cent in the current fiscal year ending in March 2015, the survey showed. The tankan's sentiment indexes are derived by subtracting the number of respondents who say conditions are poor from those who say they are good. A positive reading means optimists outnumber pessimists.

Said Hidenobu Tokuda, senior economist at Mizuho Research Institute. "The decline in sentiment at manufacturers shows some companies are worried about the yen weak pushing up input costs. However, manufacturing has bottomed out and should recover.

"Capital expenditure plans are healthy and sentiment at non-manufacturers is improving, which suggests the economy can continue to recover gradually.

"These results don't support a need for more monetary easing, but we need to keep an eye on oil prices and how this will impact inflation expectations."