• Kyodo

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Business confidence among workers with jobs sensitive to economic conditions improved in July for the first time in four months on favorable sales at department stores, the government said Monday.

The diffusion index of sentiment over the nation’s current economic situation among so-called economy-watchers such as taxi drivers and restaurant employees rose 3.9 points from June to 45.1, the Cabinet Office said.

Any reading below the boom-or-bust line of 50 indicates overall pessimism.

The government upgraded its basic assessment for the first time in 16 months, saying the survey suggested the economy has “shown signs of pickup” as calm was restored to the financial market following turbulence in June amid weaker-than-expected U.S. jobs data and Britain’s vote to leave the European Union.

The diffusion index is based on whether respondents believe economic conditions have improved or worsened over the past three months.

An official at a department store in the Kinki region said sales had been favorable during the summer sales campaign, while an official at a travel agency in the Kanto region cited stronger-than-expected demand for travel abroad.

But another department store official in the Kanto region pointed to a sales decline after the yen’s appreciation led to a slowdown in consumption by foreign tourists in value terms.

Meanwhile, the index for the direction of economic conditions in the coming months was at 47.1, up 5.6 points, partly reflecting expectations for favorable effects of the government’s economic stimulus measures.

In the survey, the office polled 2,050 workers across the country from July 25 to 31, of whom 1,862, or 90.8 percent, responded.

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