50% of business leaders have negative view of Japan's economy

People shop at a department store in Fukuoka on Oct. 5 last year after the consumption tax rate was raised on the start of the same month. (Credit: The Yomiuri Shimbun)

Half of the heads of the nation's leading companies have a less than positive outlook on the economy for the next six months or so, according to a Yomiuri Shimbun questionnaire survey for the New Year.

In the survey, 30 top executives were asked questions about Japan's economy. Fifteen respondents felt that the economy would "recover moderately," while 12 respondents believed the economy would be "in a standstill," and the final three said that it would "moderately deteriorate."

These survey results show that the views of Japanese business leaders are divided amid uncertainty over the global economy. In a previous survey from a year ago, 23 of the respondents said the economy would experience moderate recovery while seven felt that it would be in a standstill.

(Credit: The Yomiuri Shimbun)

When the 15 executives who said the economy would either be "in a standstill" or "moderately deteriorate" were asked to identify factors behind the economic slowdown in the latest survey, "mounting trade friction between the United States and China," and "sluggish personal consumption" were each chosen by eight of the executives. Multiple answers were allowed for this question.

When the 15 leaders who expected future economic recovery were asked about the factors behind their views, again with multiple answers allowed, 10 cited "recovery in capital spending" and eight cited "recovery in personal consumption."

Whether there is an improvement in consumer sentiment, which continues to be weak due to the consumption tax hike in October last year, and how U.S.-China trade friction unfolds will likely decide the course of Japan's economy this year.

(Credit: The Yomiuri Shimbun)

Twenty-one of the 30 executives think that the 225-issue Nikkei Stock Average will peak within the range of 24,000 to 25,000 points.

When asked to predict a floor for the Nikkei, 10 of the respondents, the highest number, said it would be 21,000. Only two said it would fall below 20,000.

In the survey, 16 of the respondents expect the weakest value of the yen to be around 110 yen to the dollar, while 22 said its strongest value would be around 105 yen.

The survey was conducted in December via direct interviews or paper questionnaires.

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