Against this backdrop, the June 2013 Tankan (ShortTerm Economic Survey of Enterprises in Japan) showed a significant improvement in business sentiment not only in the manufacturing sector, which has greatly benefited from the correction of the yen’s appreciation, but also across a wide range of other sectors including nonmanufacturing, as well as upward revisions in firms’ business forecasts such as with regard to profits and fixed investment.
Taking into account that the level of economic activity had been rising moderately and a virtuous cycle from income to spending had gradually started operating, the Bank of Japan, at the Monetary Policy Meeting held on July 10 and 11, 2013, raised its basic assessment of the domestic economy, from the assessment that the economy “has been picking up” to the assessment that it “is starting to recover moderately.” As for the outlook, exports are expected to increase moderately, mainly reflecting the pick-up in overseas economies and the correction of the yen’s appreciation.