Survey of Corporate Attitudes with respect to Monetary Easing Policy
60% of Companies “Feel No” Monetary Easing Effects
— Average inflation rate expected to be 1.29% in 5 years —
The Bank of Japan continues the monetary easing policy it started in April of 2013, and implemented a policy for “Quantitative and Qualitative Monetary Easing with Yield Curve Control” as a new policy framework on September 21. Furthermore, as the economy continues to be sluggish, the government is introducing and shifting financial and fiscal policies, which form the two wheels of its economic stimulus measures, through its cabinet level decision on an economic measure having a business scale of 28 trillion yen in August, and by establishing a secondary supplementary budget for FY 2016 on October 11, etc.
Therefore, Teikoku Databank has conducted a survey of corporate opinions with respect to the effects of monetary easing policies and government economic measures. Note that this survey was conducted in conjunction with the October 2016 TDB Trends Research.
*Survey period: October 18 – October 31, 2016; Companies Surveyed: 23,779; Valid Responses: 10,243 (Response Rate: 43.1%).
*Details of this survey can be found on the dedicated Economic Trend Survey HP. (http://www.tdb-di.com).
Primary points of survey results(summary)
- 1 59.7% of companies said they “feel no” effects of the monetary easing policy, while only 12.9% said they “feel” said effects. The “finance” (24.8%) and “real estate” (22.0%) sectors exceeded 20%. Most companies have not felt the effects of the monetary easing in a realistic way.
- 2 51.8%, or over half, of companies said the sales prices of their main products and services have “not changed” compared to a year ago. Only 17.7% said prices had “risen,” which is 6.3 points less than the 24.0% that said prices have “fallen.” On average, sales prices decreased 0.48%. By industry, “real estate” prices rose 0.81%, while “retail” prices fell 0.92%.
- 3 Perspectives on government economic measures were dispersed, with 24.5% of companies saying they are “optimistic” with regard to government economic measures, 29.6% saying they are “pessimistic”, and 32.3% saying they are “neither optimistic nor pessimistic”. Of the economic measures to be hoped for, the largest percentage, or 39.7%, expressed that optimism with regard to “plans for increasing personal income,” while 30% expressed optimism with regard to “support for increasing the management capabilities and productivity of small and mid-sized companies” and “policies for dealing with the lack of manpower.”
- 4 Prices are expected to rise by 0.44% on average next year (FY2017), and by 1.29% in 5 years (FY2021). Thus, while prices are expected to be higher in 5 years than they will be next year, it appears that they will still be below the Bank of Japan’s target of 2%.