Japan Reuters Tankan shows manufacturers’ sentiment slips to six-month low

The latest Reuters Tankan survey reveals that Japan's manufacturing sentiment has slipped to a six-month low of +7 in January, down from +10 in December. This marks the second consecutive decline, indicating waning optimism among manufacturers. The decline has been mainly driven by materials sectors, notably oil and ceramics, which have faced significant drops. Companies have reported softer demand from key export markets, particularly citing weaker orders from China. In contrast, sectors such as automotive and electronic machinery show resilience, suggesting some segments within Japan's industry are faring better compared to materials producers. The outlook for non-manufacturers appears more cautious, hinting at potential challenges ahead for the service sector as well.