MNI 5 THINGS: BOJ Sep Tankan: Biz Short-Term CPI Outlook Slips

     TOKYO (MNI) - The short-term inflation outlook among Japanese companies

fell slightly from three months ago but medium- to long-term inflation outlook

was unchanged from June, indicating the pace of a pickup in consumer prices will

remain slow, the Bank of Japan's quarterly Tankan survey for September showed .

     The inflation outlook follows the main Tankan results released Monday, that

showed a slight worsening of business sentiment, hit by rising costs, labor

shortages and uncertainty over the impact of U.S. trade disputes on global

demand.

     The survey, published Tuesday, was conducted from August 27 to September

28.

     The key points from the inflation outlook section of the Tankan follow.

     --In the September survey, companies on average saw a slightly slower pace

of increase in consumer prices for one year ahead, compared to the previous

survey, while leaving their inflation forecasts for three and five years ahead

unchanged.

     --Firms on average expect the annual consumer inflation rate at 0.8% a year

from now, down from 0.9% in June. But companies expect a 1.1% rise for both

three and five years ahead, unchanged from June.

     --Many companies -- 33% of those polled, the same as in the previous survey

-- expect the inflation rate to be about 1% in 12 months. The survey showed that

12% of all firms (12% previously) projected 2% inflation a year ahead while 36%

(35% three months earlier) saw a flat inflation rate during the same period.

     --Smaller firms continued to project higher inflation than larger

corporations because they tend to be hit harder by rising costs and a tighter

labor supply.

     --The survey showed companies on average expect sales prices to rise 0.8% a

year from now, up from +0.7% in June. They saw an increase of 1.3% three years

ahead, also up from +1.2% in June, but left their five-year sales price forecast

at 1.5%.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: MAJDS$,MAUDR$,MAUDS$,MMJBJ$,MMUFE$,M$A$$$,M$J$$$,M$U$$$]