Survey finds bleak outlook for Japanese companies in 2023

Major Japanese companies have grown more pessimistic about the economy, given higher costs and a weaker yen, according to a survey by Kyodo News.

The survey of 117 companies found just over half, or 56%, expect the economy to grow this year. That was down sharply from 84% a year earlier, said the survey released this week.

The percentage of firms forecasting growth was at its second lowest in 10 years for the annual survey, and the companies also expressed worries about slowdowns in the United States and China in 2023.

The war in Ukraine has pushed prices of oil and other raw materials higher while at the same time the yen has weakened against the U.S. dollar, raising risks for the world’s third-largest economy.

The bleak outlook also reflects worries over a possible global recession as central banks in the U.S. and other major economies raise interest rates to counter inflation.

The dollar rose to about 150 yen at its peak last year from 115 yen at the beginning of the year. Yesterday, it was trading at about 130 yen.