The tankan survey of business sentiments for September by the Bank of Japan shows that uncertainty hovers over the Japanese economy. If necessary, the central bank should take additional monetary easing measures since injecting ¥10 trillion into an assets purchase fund Sept. 19. The government needs to take short- and long-term steps to buoy the economy.
The diffusion index (DI) for major manufacturers for September was minus 3, marking the first drop in nine months. The DI represents the percentage of firms that say business prospects are good minus those that say business prospects are bad.
Major manufacturers' DI for business prospect three months later was also minus 3. The worsening of the DI is mainly attributable to weak production and exports caused by a slowing Chinese economy and other overseas economies amid European sovereign debt problems.