Japan: Tankan survey results for large businesses in line with expectations - BBH

Research Team at BBH notes that the Japan's Tankan survey results for large businesses were in line with expectations. 

Key Quotes

“The diffusion index for large manufacturers rose to 10 from 6.  It is the high for the year, after having been stuck at 6 for the first three-quarters.  It is expected to slip to 8 in March 2017.  Large non-manufacturers' sentiment was expected to edge up but was flat at 18.  It is expected to slip to 16 in March.  Sentiment among small companies posted small gains, which are expected to be short-lived as well.”

“Perhaps the most disappointing part of the survey was the sharper than expected decline in capex plans.  They were reduced to 5.5% from 6.3%.  Capex plans in Q1 are often the weakest of the year.  It has been the case for the past six years.  If Q1 readings were excluded, today's results show the weakest capex intentions since Q3 13.”