Major Japanese firms' sentiment turns negative

Business sentiment among major Japanese firms has turned negative for the first time in three quarters. Pessimism in the manufacturing sector is seen as the main cause.

A government survey for the January-to-March period showed a result of minus 3 points.

A negative reading means the majority of respondents think economic conditions have worsened.

The index had been positive for two straight quarters starting in July last year as the impact of the coronavirus pandemic grew less severe.

The figure for manufacturers stood at minus 10.5. Companies in the chemical and food industries said conditions worsened as the cost of materials and energy rose.

Meanwhile, sentiment among non-manufacturers was plus 0.6. The service sector benefited as travel demand and the flow of inbound tourists increased.

The major companies expect an improvement in the coming quarter. The outlook gauge is at plus 0.7.

The Finance Ministry says the economy is experiencing a moderate recovery although some weaknesses remain.