Surging energy costs, supply chain disruption and Russia’s invasion of Ukraine have knocked Japanese business confidence lower for the first time since the outbreak of the Covid-19 pandemic two years ago, an important survey has shown.
The latest quarterly survey by the Bank of Japan revealed that sentiment among big Japanese manufacturers fell for the first time since the April-June 2020 quarter, marking a turning point for Asia’s second-biggest economy, where businesses had previously been cautiously optimistic about an end to the pandemic.
But the survey, which was conducted between late February and late March, also showed the large disconnect between the foreign exchange assumptions made by corporate Japan and the recent reality of a market where the yen plummeted this week to a seven-year low.