Japan Tankan Confidence Survey Fell to Record Low

The Bank of Japan announced that Tankan, the economic survey of enterprises that indexes sentiment among large manufactures, went down to minus 58 in March from minus 24 in December. This is the lowest since the survey started in 1974. The market expectation for Tankan was minus 55. A negative number means pessimists outnumber optimists.

While the real economy may contract further and the situation is even more serious among smaller corporations, there are signs that may suggest certain improvements. The auto and other industries have aggressively reduced inventories since the end of last year. The March Tankan survey indicated that business confidence was projected to improve for the next quarter.

The Nikkei 225 Index hit a recent low on March 10 at just above 7000 and moved up to 8843 on March 27.