Nearly half of Japanese firms approve of BOJ chief’s performance: Reuters poll

Audio By Carbonatix

Enlarge

By Kiyoshi Takenaka

TOKYO (Reuters) -Almost half of Japanese companies regard Bank of Japan (BOJ) Governor Kazuo Ueda’s performance positively, outpacing the 30% with negative views of his handling of monetary policy, a Reuters survey showed on Thursday.

Under Ueda, the BOJ last year exited a decade-long, massive stimulus programme by ending a negative rate policy, risky asset purchases and yield curve control (YCC), which caps the benchmark 10-year yield around 0%.

About 47% of respondents hold a positive view of the monetary policy handling of Ueda, who is nearly half-way through his 5-year term, while 27% do not value his performance much and 3% do not simply value it, the survey showed.

“We believe it’s commendable he has managed to put an end to negative interest rates and YCC without causing much market confusion,” a manager at a ceramics manufacturer wrote in the survey.

Reasons for regarding his work negatively vary, with some respondents saying he has been too cautious in raising rates and others arguing he has been too hasty in doing so.

The central bank this year finished selling off its holdings of stocks bought in the 2000s, originally purchased to avert disruption to the banking system from falling equity prices.

Market attention has now turned to the BOJ’s timing and strategy for unloading its 37-trillion yen ($251.17 billion) holdings of exchange-traded funds (ETF).

They are estimated to have a market value of 80.1 trillion yen as of the end of August, according to Shingo Ide, NLI Research Institute’s chief equity strategist.

Asked how the holdings ought to be dealt with, 60% of respondents said the BOJ should look into proper ways to handle them regardless of Ueda’s current term ending early 2028, while 21% said a policy should be set during his tenure.

The survey was conducted by Nikkei Research for Reuters from August 27 to September 5. Nikkei Research reached out to 497 companies and 238 responded on condition of anonymity.

FOREIGN WORKERS

The poll also showed eight out of every 10 companies employ non-Japanese workers, as Japan Inc faces chronic labour shortfalls.

Asked about reasons for turning to foreign workers, 55% cited labour shortages, 39% said the move is part of their effort to strengthen overseas operations and 30% said they aim to acquire specialised knowledge and technology through the move. The question allowed multiple answers.

With the number of foreign workers in Japan rising 12.4% from a year earlier to a record 2.3 million in 2024, immigration emerged as one of the hottest issues in an upper house election in July.

Through the election, an upstart party called Sanseito, which advocates tougher rules on accepting foreign workers, emerged as the fourth-largest opposition in the upper chamber.

More than three quarters of survey respondents said restrictions on letting in foreigners should not be strengthened.

“With the Japanese population shrinking, we have no options but to accept foreigners for the development of the country,” an official at a transportation company said.

The number of bankruptcies in which labour shortfalls have played a role came to 238 in the first eight months of the year in Japan, on a trajectory to hit a record high for the whole of 2025, according to Tokyo Shoko Research.

On their earnings outlook for the second half of the business year starting October, about 47% of respondents said they will likely fare as originally anticipated, while 32% said they could undershoot initial estimates.

Sources of concern for the six-month period include changes in raw material prices, foreign exchange and interest rate moves, and the potential impact from the new U.S. tariffs, the survey showed.

($1 = 147.3100 yen)

(Reporting by Kiyoshi Takenaka; Editing by Sam Holmes)