REPEAT:MNI 5 THINGS:BOJ June Tankan: Short-Term CPI Outlook Up

     TOKYO (MNI) - The Bank of Japan's quarterly Tankan survey for June on

Tuesday showed the short-term inflation outlook among companies rose slightly

from three months ago but medium- to long-term inflation outlook was unchanged

from March, indicating the pace of a pickup in consumer prices will remain slow.

     This 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 was conducted from May 29 to June 29.

     The key points from the inflation outlook part of the Tankan.

     * In the June survey, companies on average saw a slightly faster 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 0.9% a year

from now, up from 0.8% in March. But companies expect a 1.1% rise for both three

and five years ahead, unchanged from March.

     * Most 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 35% (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 0.7% a

year from now, unchanged from March. They saw an increase of 1.2% three years

ahead, also unchanged from March, but revised up their five-year sales price

forecast to +1.5% in June from +1.4% in March.

--MNI Tokyo Bureau; tel: +81 90-4670-5309; email: max.sato@marketnews.com