Hokkaido Business Sentiment Surges Amid Passing-Through Success

The Bank of Japan's Sapporo branch released its September Tankan survey on October 1, showing Hokkaido's Business Sentiment Index (DI, all industries) at plus 19, up 4 points from the previous June survey. Progress in passing through cost increases to prices drove a second consecutive quarter of improvement.

The Business Sentiment DI is calculated by subtracting the percentage of companies reporting 'poor' conditions from those reporting 'good' conditions. The survey covered 426 companies in Hokkaido, 95 manufacturers and 331 non-manufacturers, and was conducted from August 26 to September 30.

The forward-looking Business Sentiment DI for December is projected at plus 11 for all industries, an 8-point decline from current levels. Uncertainty over the impact of Middle East tensions and rising interest rates is weighing on corporate sentiment.