MNI BRIEF: Japan Oct Sentiment Index Sees 3rd Straight Drop

Japan's sentiment index posted a third straight decline in October, as did the outlook index for two to three months ahead, but the government left its assessment unchanged, the Economy Watchers Index released by the Cabinet Office showed on Thursday.

The Economy Watchers sentiment index for the current economic climate fell a seasonally adjusted 0.4 points to 49.5 in October from 49.9 in September. The government said that the economy is recovering moderately as a trend but “it is marking time.

The drop of the sentiment was led by the worsening of indexes linked to firms and the labor market, and is now clouding the Bank of Japan’s view that private consumption will continue its moderate recovery.

Looking ahead, a moderate economic recovery is likely to continue, although there is concern over the impact of high prices. The outlook index for two to three months ahead fell 1.1 points to 48.4 in October from 49.5 in September.