"The slowdown in exports is greater than previously thought"
- Yuichi Kodama, chief economist at Meiji Yasuda Life Insurance
Japanese businesses sentiment deteriorated in the third quarter of 2012, a sign the world's third biggest economy is slowing, the Bank of Japan reported Monday. Tankan Manufacturing index dropped to a seasonally adjusted -3, down from -1 in the previous quarter. A reading above 0.0 indicates improving conditions, while any reading below indicates worsening conditions.
"Japan's economy will probably have two consecutive quarters of contraction in the July-September and October- December periods," said Kiichi Murashima, chief economist at Citigroup Global Markets Japan Inc. "Exports are the main reason for the economic contraction."
"Companies are becoming more concerned about the outlook for the economy and their businesses," said Yoshimasa Maruyama, chief economist at Itochu Corp. in Tokyo. "Some of them may start to consider postponing planned business investment for this fiscal year."
The Nikkei 225 Stock Average slid 0.12 per cent, or 10.46 points, to 8,786.05. The broader Topix Index erased 0.16 per cent, or 1.16, to 731.19.
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