Japan’s business confidence hits two-year low as trade war stings



Leika Kihara, Tetsushi Kajimoto | Reuters

TOKYO (Reuters) – Japan’s business mood slumped to a two-year low in the March quarter, a central bank survey showed, underscoring concerns that Sino-U.S. trade tensions and softening global demand were taking a toll on the export-reliant economy.

The gloom was most pronounced among big manufacturers, where sentiment soured at the fastest pace in more than six years, stoking fears that uncertainty over the global outlook could discourage companies from spending on wages and expenditure.

Separately on Monday, a private business survey showed manufacturing activity in Japan contracted for a second straight month in March, with output down at the sharpest rate in nearly three years.

The downbeat surveys bolstered the view that Prime Minister Shinzo Abe’s reflationary policy dubbed “Abenomics” is sputtering, keeping the Bank of Japan under pressure to maintain or even ramp up its massive stimulus program, analysts say.

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