Japanese CEOs are more pessimistic about the economy, exercising caution leading up to upcoming wage increases.


Japanese CEOs are more pessimistic about the economy, exercising caution leading up to upcoming wage increases.

According to a recent survey conducted by Nikkei, optimism among Japan’s corporate heads is on the decline. In the survey, only 50% of respondents believed that the economy is “expanding” or “expanding slightly”, a sharp decrease from the previous quarter where 72% were positive about the economy. This is the lowest reading since the March 2022 poll, which only had 13.1% of respondents feeling optimistic.

Additionally, 45% of respondents in the survey said they believe the economy will remain flat, a significant increase from the 20% in the previous poll. The reasons for this shift in sentiment included 80.3% of respondents blaming flat consumer spending, 40.9% citing stagnation in China, and 37.9% pointing to persistent labor shortages.

The Nikkei survey is conducted quarterly and provides insights into the sentiment of Japan’s corporate leaders. The Summary of the March BIOJ meeting also indicated a slow rate cycle ahead, further reinforcing the downward trend in optimism about the economy.

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