Japan Tankan May Show Firms to Cut Spending Even Amid Recovery
The Bank of Japan’s Tankan survey will probably show this week that the economic recovery is too weak to convince companies to invest.
Large firms plan to cut capital spending by 9 percent this year, little changed from estimates made three months ago as the nation was emerging from a recession, economists predict the Oct. 1 report will show. Sentiment among big manufacturers is expected to gain for a second period after March’s record low.
Toyota Motor Corp., which has benefited from worldwide government efforts to boost consumption, is still producing a third fewer cars than it is able to build. Bank of Japan Governor Masaaki Shirakawa said this month that while the economy is showing “signs of recovery,” he’s not confident that demand will hold up.
Originally posted on Bloomberg