By Kaori Kaneko
TOKYO (Reuters) -Japanese manufacturing confidence surged to its highest level in nearly four years in November, led by the electronics and auto sectors which have been buoyed by softness in the yen and solid orders, the Reuters Tankan poll showed.
The monthly poll, which tracks the Bank of Japan’s closely watched quarterly business survey, showed the manufacturers’ sentiment index climbed to plus 17 – a level last seen in January 2022 – from plus 8 in October.
In particular, the electronics sector subindex soared to plus 25 – its highest reading since December 2021 – from plus 5 last month.
“The weak yen is giving exports a tailwind,” a manager at an electronics company wrote.
The Japanese currency lost more than 5% since the previous Reuters Tankan poll to trade around 154.50 yen to the dollar during the October 28-November 7 survey period.
Another manager also wrote that “the semiconductor market, especially for memory, is performing well.”
The poll was sent to 495 non-financial companies, of which 222 responded. Respondents take part on condition of anonymity.
The auto and transport machinery industry, also a big beneficiary of yen weakness, likewise posted a huge jump, with its index rising to plus 27 from plus 9.
The indexes are calculated by subtracting the percentage of pessimistic responses from optimistic ones. A positive figure indicates optimists outnumber pessimists.
In addition, some managers in the auto sector cited stable orders from their customers.
That said, the overall manufacturers’ index is expected to drop back to plus 15 by February, with some managers expressing concerns about sluggish auto production and sales.
Honda this month revised down its full-year sales outlook by 8% to 3.34 million vehicles, hurt by a shortage of components that use chips from Netherlands-based Nexperia. Nissan, in the midst of a large restructuring, has also cut its Japan output estimates as consumers shied away from the troubled brand.
Manufacturers across many sectors expressed anxiety about the impact of U.S. President Donald Trump’s tariff policies, noting that tensions with trading partners especially China had led to much uncertainty and it was hard to read demand.
The sentiment index for non-manufacturers held steady at plus 27, with high tourist levels bolstering an array of service industries. The outlook for February was also plus 27.
(Reporting by Kaori Kaneko; Editing by Edwina Gibbs)
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