An increasing number of Japanese-affiliated overseas manufacturing subsidiaries, particularly in Asia and the United States, expect their sales to decline in the January-June period, the Trade Ministry said Friday in its quarterly survey.

The diffusion index, calculated by subtracting companies forecasting sales to decrease from those with positive predictions, dropped 9.2 points from the previous survey to 16.9, the third straight quarter of decline, the Ministry of Economy, Trade and Industry said.

The quarterly survey, which had a response rate of 64.9 percent, was conducted in February on 2,903 overseas companies controlled by 1,335 Japanese manufacturers.

Asia-based subsidiaries are anticipating a decrease in exports to the United States due mainly to the slowdown in the U.S. economy, a ministry official said.

However, the responding companies saw a year-on-year increase in sales of 15.2 percent in the December quarter to 9.686 trillion yen, marking the fourth consecutive quarter of increase, the ministry said.

Brisk sales by Asian subsidiaries of electronic and transportation machinery contributed to the strong overall performance, it said.

Of the total, exports back to Japan soared 24.1 percent to 798.9 billion yen for the fifth straight quarterly rise, with those from Asia jumping 25.6 percent, due mainly to information technology-related products, which expanded 29.5 percent to 283.03 billion yen, it said.

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