Japan manufacturers’ mood hits more than 5-year high on chip demand: Reuters poll
Workers walk between precision-machining machines for automotive parts inside a factory at Kyowa Industrial Co. in Takasaki, Gunma Prefecture, Japan April 11, 2025. REUTERS/Issei Kato/File Photo
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TOKYO, Nov 11 : Japanese manufacturers’ sentiment rose to its strongest level in more than five years in November as booming semiconductor demand underpinned broad-based optimism, while the non-manufacturers’ mood hit its highest in over eight years, a Reuters monthly poll showed.
The Reuters Tankan sentiment index for manufacturers rose to plus-27 in November, the highest reading since August 2021, from plus-22 in October.
The poll, a leading indicator of the Bank of Japan’s quarterly Tankan business survey, was conducted from October 27 to November 6 and received responses from 214 of 508 firms. The indexes are calculated by subtracting the percentage of pessimistic responses from optimistic ones, with positive figures indicating net optimism.
The improvement in manufacturers’ confidence was led by the electronics sector, where sentiment jumped to plus-39 in November from plus-25.
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“Semiconductor demand, particularly for memory, is very strong,” a manager at an electronics machinery company said.
Sentiment in the precision machinery sector, which includes some chip-related equipment makers, also improved to plus-42 from plus-38.
“Orders from both domestic and international remain robust,” said a manager at a precision machinery company.
Another respondent at a machinery firm said that product shipments for the semiconductor market have reached an “unprecedented level”.
Oil refinery and ceramics rose to plus-25 from plus-14, while chemicals improved to plus-33 from plus-27.
The non-manufacturers’ index surged to plus-35 in November from plus-23 to reach a level not seen since June 2018.
Sentiment in information and communications rose to plus-29 from plus-8 thanks to strong orders.
Services and others rose strongly to plus-43 in November from plus-19. One manager said that “tight labour market conditions persist among companies, keeping demand for talent at a high level.”
Looking three months ahead, manufacturers expect sentiment to edge up to plus-28 in February, while non-manufacturers see confidence easing to plus-29.
Rising prices and higher interest rates weighed on both sectors, the survey found, with some firms struggling to pass on increased costs to customers.
Source: Reuters
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