Japan Business Confidence:

 Article Source: https://mainichi.jp/english/articles/20220608/p2g/00m/0bu/059000c

Article:

TOKYO (Kyodo) -- Business confidence among workers with jobs sensitive to economic trends rose for the third straight month in May, supported by a solid service sector in the wake of the removal of anti-coronavirus restrictions, government data showed Wednesday.

The diffusion index of confidence in current conditions compared with three months earlier among "economy watchers," such as taxi drivers and restaurant employees, came to 54.0, up 3.6 points from April, according to the Cabinet Office.

A reading above 50 indicates that more respondents reported improving conditions than worsening conditions over the past three months.

Ideas:

Any survery is hard to explain exactly as there could be many reasons for the respondents answers. Unfortunately sometimes the questions are rigged to get a specific answer that the surveyers want to see or hear.

That doesn't mean it happened here but it does happen somtimes.

But mostly likely as the Japanease economy has continued to move out of the pandemic situation the economic situation is improving and wokers, in these service categories are feeling much better now compared to six months ago.

But then again, does this mean all workers in these categories are feeling good about the economy. Most likely not as they might know the pandemic is far from over and it can easily come back and make their situation not so good again.

Article:

Following the continued improvement, the Cabinet Office upgraded its basic assessment, saying, "The economy is gradually picking up," and dropped its reference to the negative impact of the coronavirus for the first time since it appeared in February 2020.

In the poll, many workers said their businesses fared well during the weeklong Golden Week holiday through early May. It was the first time in three years that the key holiday period for the tourism and retail sectors saw no COVID-19 restrictions such as shorter working hours for restaurants and bars.

"Even after Golden Week, we have seen more customer visits on weekday evenings or weekends," a staffer at a department store in the southwestern region of Kyushu said, adding that people appear to be less cautious about going out.

Ideas:

Yes, the Japanese economy is most likely picking up but does that mean all businessses are again doing better. Most likely not but maybe overall the economy might be heading in the right direction.

No doubt many businesses saw increases during the Golden Week holiday period as it was the first time in three years that people were able to finally get out and travel.

But can one holidy period be enough for many businesses to overcome their losses related to the two-year pandemic situation. Most likely its going to take a while for many businesses to recover completely, if at all, from the pandemic.

And now there is the ideas of increasing inflation which might not be as bad as the pandemic but it might cause some challenges for consumers and for businesses which is going to cause even more problems related to getting back to some kind of normalcy like in 2019 before the pandemic.

Article:

A worker at a shop on a shopping street in the Tohoku region in northeastern Japan said social activities are returning to normal, with festivals and events being planned ahead of summer.

Still, many voiced concerns over the business outlook, citing surging food, fuel and other commodity prices following Russia's invasion of Ukraine.

"Raw material prices have surged and almost all of our retail prices were raised," an appliance store worker said. "We are also facing a serious supply shortage due to the Ukraine crisis, lockdowns in China and the semiconductor drought."

Ideas:

Yes, the worst of the pandemic might be over, except for new surges here or there and the new threat is now increasing inflation and increasing costs for some or many businesses.

Just how consumers will respond or react to any prices increases, if any, will be interesting to see and Japanease consusmers have been used to low prices for some time now.

But businesses, which have been reluctant to pass on their costs to the consumer or even next in the supply chain might not have a choice and have to pass on some or all of their costs.

So it will be interesting to see what happens and how consumers respond, despite BOJ's Kuroda making a mistep in his talking recently that consumers have gotten used to price increases.

Article:

The diffusion index gauging business sentiment in the coming months climbed 2.2 points from the previous month to 52.5 in May, rising for the fourth straight month.

The Cabinet Office surveyed 2,050 workers from May 25 to 31, of whom 1,831, or 89.3 percent, responded.

Ideas:

Business sentiment might have improved but with increasing energy costs, raw material costs, supply shortages, and businesses passing on their costs to consumers or the next in the supply chain there are definite challenges ahead for many businesses and many consumers.

Unfortunately the Japanese economy never seems to grow as much or as fast as for example other economies.

The Japanese economy is very stable economy which means even if growth is only 1 percent that is a lot for the 3rd largest economy in the world.

But, like everywhere else now. there a growing sense of not just income-inequality but now because of the pandemic business-inequality, meaning many businesses have yet to recover fully from the pandemic situation and might not for a very long time.

Have nice day and be safe!