Japanese manufacturers' confidence rose in November to its highest level since August 2021 as semiconductor demand supported the sector, while the Reuters Tankan poll also found stronger sentiment among nonmanufacturers.
The manufacturing index climbed five points from October to +27. Reuters said that was the highest reading since August 2021. In the poll, electronics rose to +39 from +25, precision machinery to +42 from +38, oil refining and ceramics to +25 from +14, and chemicals to +33 from +27. A manager at an electronics machinery company told Reuters that demand for semiconductors, especially memory chips, was very strong.
The Reuters poll's nonmanufacturing index increased to +35 from +23, its highest level since June 2018. Information and communications rose to +29 from +8, while services and others climbed to +43 from +19. A manager in the services and others category told Reuters that tight labor-market conditions were keeping demand for talent high.
The outlook differed by sector. For February 2027, manufacturers expected their index to reach +28, while nonmanufacturers forecast a decline to +29. Reuters reported that higher prices and interest rates weighed on both groups, and some firms could not pass higher costs on to customers.
The poll ran from Oct. 27 to Nov. 6 and drew responses from 214 of 508 firms. The Reuters index measures the difference between the share of firms reporting optimism and the share reporting pessimism.
Reuters presents its monthly results as an early read on a separate quarterly business survey by the Bank of Japan (BOJ). The BOJ's latest survey, released Oct. 1 for September, put large manufacturers at +24, up from +22 in June. It uses a different timetable and coverage, so its September figure is not a direct comparison with Reuters' November result.
