Slump in Japan Firms’ Confidence

Japanese business confidence has had the biggest drop in 34 years. The drop was due to fears the economy is headed towards a very long recession. The Tankan survey, which measures business sentiment, fell to -34 from -3. This was the fourth straight decline of the index. Analysts speculate interest rates will be lowered sometime in the future, the exact date is unknown.

This is the first recession for Japan in seven years. Japanese exporters have been especially hard hit due to the global financial downturn and the yen’s surge to a thirteen year high. The current index of -34 was expected, but the next survey is expected to decrease to -36.