Japan Tankan Survey: A strong first half, a cautious outlook

研报英文原文证据摘录

Japan Tankan Survey: A strong first half, a cautious outlook

Economics - Data Reactions ● Japan

1 July 2026

signals could reinforce this momentum. Prime Minister Sanae Takaichi’s initial economic blueprint sets out an investment roadmap of

over JPY370trn through FY2040 across 17 strategic areas, including AI and semiconductors. It also estimates that, if fully realised,

private capex in FY2040 could reach JPY230trn annually with nominal GDP approaching JPY1,100trn.1 The government is expected

to formally approve its basic guideline and growth strategy at a Cabinet meeting in July.

Tight labour market conditions remain a constraint on business operations and are reinforcing wage momentum (see Chart 5).

Consistent with that, FY2026 Shunto wage negotiations point to an average wage increase of 5.02%, with the final outcome due on 3

July. Even so, stronger nominal wages have not fully translated into purchasing power, as real wages remain below pre-pandemic

levels. This keeps households cautious and particularly sensitive to further price increases. With the cost of living still a key concern,

a cut to the consumption tax on food is currently being debated in Japan’s Parliament (see Japan Economics Comment: The

consumption tax cut debate, 25 June 2026).

Looking ahead, firms’ three-month outlook has softened, with the deterioration more pronounced among SMEs, reflecting uncertainty

around the US-Iran peace agreement. With input-price volatility rising, the Tankan suggests firms continue to pass costs into output

prices, including among small manufacturers, with all firms expecting output prices to increase by 3.7% over the next year (see Chart

6). For consumers, core CPI (excluding fresh food) remained below the Bank of Japan’s (BoJ) 2% target at 1.4% y-o-y in May (see