Japanese Tank Report Reached a Three-year High in June

The Japanese Tankan report manifested a positive data as big manufacturers sentiment has exceeded expectations with the index reaching a three-year high. The Big Manufacturers Index came in better-than-expected up by +17 compared to the +15 forecast of Reuters. It increased up to +12 from the poll collected in March. Meanwhile, it is anticipated to reach +15 for the month of September which is higher than the +14 prediction. This index is being monitored closely as it is part of policy making based on a survey of Japanese businesses.

Other sectors also have shown good progress and large manufacturers in particular shown more prominent growth. The BOJ increased its economic analysis as the GDP forecast grew by 1.6 percent for the 2017-2018 fiscal year from 1.5 percent forecasted in January. However, the core consumer price index (CPI) rose to 1.4 percent from 1.5percent in the same duration.

Overall, the BOJ remains firm in improving inflation and will proceed with a dovish stance until the target 2 percent inflation has been exceeded in a steady pace.