MNI: Firms Inflation Outlook Rises: BOJ December Tankan

Both short- and medium-term inflation expectations at Japanese firms rose slightly in the three months December, easing concerns over weaker corporate inflation views, the latest Bank of Japan Tankan survey showed on Monday.

On average, companies saw the annual consumer inflation rate at 1.1% a year from now, up from 0.7% in September. They also saw a 1.2% increase three years and a 1.3% gain in five years ahead, compared with +1.0% and +1.1% respectively in September.

The results were consistent with the latest view that inflation expectations have picked up. The survey, conducted from Nov. 10 to Dec. 10, showed companies on average expect sales prices to rise 1.2% a year from now, up from 0.7% in September. They saw an increase of 1.7% three years ahead, up from +1.3% in September and they saw an increase of 2.3% five years sales price, up from 1.9% in September.

The Tankan showed that more businesses are considering raising retail prices than three months ago, but increases may not be sufficient to cover higher input prices.