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Japan's Business Spirits Soar on Chip Demand
12 Aug
Summary
- Manufacturers' sentiment index rose to plus 18 in August.
- Non-manufacturers' confidence climbed to plus 28.
- Semiconductor demand drives significant order intake.
Japanese business confidence demonstrated a notable improvement in August, reaching its highest point since March 2026. The manufacturers' sentiment index increased to plus 18 from plus 13 in July. This upturn was primarily propelled by strong demand for semiconductor-related products, leading to a significant rise in orders for industries like chemicals and machinery.
Non-manufacturers' confidence also saw an upward trend, climbing to plus 28 from plus 25. This positive movement was bolstered by healthy domestic consumption across various sectors, including wholesale trade and information services.
Looking ahead, while the current sentiment is strong, manufacturers anticipate a slight easing to plus 16 by November, suggesting a degree of caution regarding future business conditions. Non-manufacturers expect their positive sentiment to remain stable at plus 28.
