MNI BRIEF: BOJ Managers Note Moderate Recovery

All nine regional Bank of Japan branch managers say their respective economies have gained or recovered moderately, despite impacts due to overseas economics and price rises, the BOJ's regional economic report said on Thursday.

The report noted six out of the nine regions upgraded their economic assessment from three months ago with the remaining three regions leaving their assessment unchanged. Many managers noted pent-up demand and the recovery of inbound demand, while five out of the nine regions upgraded their assessment of private consumption from three months ago.

As for labor and wage conditions, many managers said conditions had improved following wage hikes broadly due to persistent labour shortages. However, many businesses have not decided to raise wages next year as they await other firms’ stance and price moves. Smaller firms remain cautious on wages hikes next year due to high costs.

The pace of corporate pass-through of cost increases slowed but the move continued, according to the report. Some businesses have voiced concern over elevated costs due to high crude oil price and the weak yen, while and households' savings and price cuts were observed.