A survey has shown that big Japanese companies have grown more optimistic and plan to boost spending on new plants and equipment, keeping the economic recovery on track.
Sentiment among large manufacturers rose to plus 21 in June from plus 20 in March, the Bank of Japan said in its quarterly 'Tankan' survey, which appears likely to reinforce market expectations of an end to zero interest rates.
The figure matched market predictions but was slightly below the figure of plus 22 forecast by large manufacturers in June. A positive reading means that confident firms outnumber pessimistic ones.
The headline Tankan index is well up from a low of minus 38 seen four years ago as the world's second-largest economy recovers from over a decade in the doldrums, even if still below a 13-year high of 26 reached in September 2004.
Many analysts had been expecting the BoJ to scrap its zero interest rate policy at its July 13-14 meeting if the latest Tankan survey was impressive enough, although others believe an August rate rise is more likely.
