Japan's Business Sentiment Steady in Q3

Japan's business sentiment among large manufacturers remained stable in the July-September quarter, with the Bank of Japan's 'tankan' survey reporting a sentiment index of +13, unchanged from the previous quarter. Large non-manufacturers saw a slight increase to +34, indicating positive sentiment driven by rising prices and profitability in the retail sector. Despite overall steady conditions, service-sector firms expressed caution about future business outlooks, anticipating potential downturns. Companies are expecting inflation to exceed the central bank's 2% target, supporting the likelihood of further interest rate hikes by the BOJ. The economy has shown resilience with a 2.9% annual growth rate, bolstered by wage increases and consumer spending, despite external risks from global economic conditions. The BOJ will consider these survey results during its monetary policy meeting scheduled for October 30-31.