Japan Reuters Tankan Index

The Reuters Tankan index for Japanese manufacturers increased to +18 in August 2026 from +13 in the previous month, marking the highest reading since March, supported by solid semiconductor demand. Semiconductor-related industries drove the manufacturing index higher, with the sub-index for chemicals surging to +33 from plus 23. Meanwhile, the metal and machinery industry index strengthened to +25 from +12. However, transport equipment remained flat at zero, reflecting mixed conditions in the automotive sector. Meanwhile, non-manufacturers' sentiment advanced to +28 from +25, buoyed by strong domestic consumption. Looking ahead, manufacturers expect sentiment to be stable, with the index forecast to ease to +16 in November, suggesting some caution about the business outlook. The non-manufacturers' index is expected to stay at +28.

The Reuters Tankan index for Japanese manufacturers stood at +13 in July 2026, unchanged from the previous month after rising over the previous two months, supported by solid semiconductor demand. Manufacturers reported a recovery in the semiconductor market, including memory-related demand, alongside rapidly expanding orders for products used in chip applications and AI servers. "Order volumes and values are at levels we've never seen before, and we're concerned about production capacity," a manager at a precision machinery maker said. Meanwhile, non-manufacturers' sentiment fell to +25 from +32 as the Middle East conflict, a weak yen, and rising interest rates pushed up costs. Looking ahead, manufacturers expect sentiment to edge up to +14 in October, while non-manufacturers see their index holding at +25 as businesses continue to assess the fallout from geopolitical risks and supply chain challenges.

The Reuters Tankan index for Japanese manufacturers climbed to +13 in June 2026 from +8 in May, marking a second straight month of improvement as strong semiconductor demand boosted confidence among chemicals, electronics, and machinery producers. The chemicals sector index surged to +20 from +6, while firms cited booming orders tied to the chip market despite ongoing geopolitical tensions. Meanwhile, non-manufacturers’ sentiment rose to +32 from +29, supported by stronger confidence in the real estate and construction sectors and a steady pipeline of new projects. Looking ahead, manufacturers expect sentiment to remain at +13 in September, while non-manufacturers see their index easing to +19 amid concerns over geopolitical risks and supply chain challenges. The transport machinery sector, including automakers, turned notably cautious, with its outlook falling to -13 from +13, reflecting persistent material sourcing difficulties and supply chain disruptions.