Nov. economy watcher sentiment up amid brisk sales of expensive goods

Business confidence among people in Japan with jobs sensitive to economic conditions improved in November for the first time in two months, as sales of expensive goods rose ahead of a consumption tax hike next year, government data showed Monday.

The diffusion index of sentiment over the nation's current economic situation among so-called "economy watchers," such as taxi drivers and restaurant employees, was up 1.7 points from the previous month to 53.5, staying above the threshold line of 50, the Cabinet Office said in a monthly survey.

The government upgraded its basic assessment of the survey in November for the first time in two months, saying the watchers suggest the economy is "moderately recovering."

"Many people have become willing to buy expensive goods including cars and home electronics" before the hike of the country's sales tax rate to 8 percent next April from the current 5 percent, a Cabinet Office official said.

The diffusion index to the business sentiment is based on whether respondents believe economic conditions have improved or worsened over the past three months. A reading of 50 indicates that those polled generally believe economic conditions are flat.

The index for the direction of economic conditions in the coming few months, meanwhile, climbed 0.3 point to 54.8 in November, up for the third straight month.

Despite lingering concern that the scheduled tax hike would undermine consumer confidence, expectations have been growing that the tax increase would buoy sales during Japan's year-end shopping season, the official said.

The Cabinet Office surveyed 2,050 workers across Japan from Nov. 25 to 30, of whom 1,860, or 90.7 percent, responded.