Japan's business sentiment turns positive

Business sentiment among major Japanese firms has turned positive for the first time in three quarters.

The government's latest business-sentiment survey shows the index up 1.3 points to plus 0.4 for the July-to-September period.

A positive number means a majority of businesses think conditions have improved.

The index turned positive for major manufacturers to stand at 1.7. The reading for automakers and parts suppliers jumped to plus 18.3.

That was after parts shortages were largely resolved once strict coronavirus measures were lifted in China.

In contrast, sentiment among major non-manufacturing businesses turned negative at minus 0.2, down 3.6 points from the previous quarter.

Higher running costs dragged down sentiment among retailers. Spending on procurement and utilities rose due to the weak yen.

But major companies, including the non-manufacturing sector, expect conditions to improve in the coming quarter. The sentiment outlook gauge is at plus 6.4.

The Finance Ministry says the economy is experiencing a moderate recovery, but it needs to monitor the impact of higher prices on business activity.