Overview

• Sentiment among large manufacturers rose to +14 in September, the highest since December 2024, while large non-manufacturers stayed at a strong +34.
• Big companies now plan a 12.5% increase in capital spending for the fiscal year, exceeding June’s projection and market forecasts.
• Corporate inflation expectations held at 2.4% one, three and five years ahead, reinforcing views of durable price growth.
• Both large manufacturers and services expect conditions to worsen over the next three months, with a BOJ official highlighting concern about U.S. trade policy.
• Exports and factory output fell in August as markets price roughly a 60% chance of a rate hike to 0.75% at the Oct. 29–30 BOJ meeting from 0.5%.