Bank of Japan Tankan Survey Results a Mixed Bag
June 30, 2011
10,997 companies participated in the latest quarterly survey of Japan’s central bank. In the table below which documents the evolution of results, abbreviations used in the first four columns of data stand for big manufacturers (Bm), big non-manufacturer (Bnm), small manufacturers (Sm) and small non-manufacturers (Smn). Where no “a” or “f” suffix is shown after the date of the survey, the figures are actual results. The bottom three rows are expected June 2011 results projected in the March 2011 survey (Jun 2011f), the actual results of the June 2011 survey reported today (Jun 2011a), and what respondents in the latest survey think the results will be in the next survey to be taken in September 2011. The values in this table are diffusion indices representing the percent of companies where conditions are favorable minus the percent claiming conditions to be unfavorable and omitting any firms where conditions have been neutral. When the diffusion index is positive, there is more optimism than pessimism.
This report contains bad as well as good news, but on balance is encouraging. Big firms and all firms collectively yielded a more pessimistic view of current conditions than predicted last March or than what analysts were predicting this week. The index covering large manufacturers was below zero for the first time in five quarters. However, forward-looking information was hopeful. Big firms predict a better index in September’s survey. The survey also reflected less excessive product supplies and inventories than seen three months ago. Forecasts of sales, earnings, and planned investment have been revised upward.
Small firms do not share the view of big firms that conditions will be better by the end of summer. This is not unusual. Whenever an acceleration or deterioration in trend occurs, big firms tend to reflect the shift sooner. The small firms, unlike the big ones, had better June indices than they had been predicting three months ago. A final piece of good news is that Japan’s current recession is not associated with the extremely poor Tankan readings of the 1998 Asian crisis or those that were reached in the Great Recession.
| Bm | Bnm | Sm | Snm | All | |
| Dec 1998 | -49 | -39 | -56 | -43 | |
| Dec 1999 | -17 | -19 | -32 | -28 | |
| Dec 2000 | 10 | -10 | -16 | -23 | |
| Dec 2001 | -38 | -22 | -49 | -39 | -40 |
| Dec 2002 | -9 | -16 | -33 | -36 | -28 |
| Dec 2003 | 11 | -9 | -13 | -28 | -15 |
| Dec 2004 | 22 | 11 | 5 | -14 | 1 |
| Dec 2005 | 21 | 17 | 7 | -17 | 5 |
| Dec 2006 | 25 | 22 | 12 | -4 | 10 |
| Dec 2007 | 19 | 16 | 2 | -12 | 2 |
| Mar 2008 | 11 | 12 | -6 | -15 | -4 |
| Jun 2008 | 5 | 10 | -10 | -20 | -7 |
| Sep 2008 | -3 | 1 | -17 | -24 | -14 |
| Dec 2008 | -24 | -9 | -29 | -29 | -24 |
| Mar 2009 | -58 | -31 | -57 | -42 | -46 |
| Jun 2009 | -48 | -29 | -57 | -44 | -45 |
| Sep 2009 | -33 | -24 | -52 | -39 | -38 |
| Dec 2009 | -25 | -21 | -41 | -34 | -31 |
| Mar 2010 | -14 | -14 | -30 | -31 | -24 |
| Jun 2010 | 1 | -5 | -18 | -26 | -15 |
| Sep 2010 | 8 | 2 | -14 | -21 | -10 |
| Dec 2010 | 5 | 1 | -12 | -22 | -11 |
| Mar 2011 | 6 | 3 | -10 | -19 | -9 |
| June 2011f | 2 | -1 | -16 | -27 | -14 |
| June 2011a | -9 | -5 | -11 | -26 | -18 |
| Sep 2011f | 2 | -2 | -15 | -29 | -15 |
Copyright Larry Greenberg 2011. All rights reserved. No secondary distribution without express permission.
Tags: Bank of Japan Tankan
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