Global Economic Slowdown, Uncertainty About the Outlook, and Sluggish Domestic Consumption

「During the interim consolidated accounting period, investment demand in AI-related fields expanded and corporate capital investment also trended upward, while economic sentiment in Japan improved. At the same time, uncertainty about the outlook continued amid stronger concerns over rising prices for petroleum-related products, including fuel and resources, due to heightened tensions in the Middle East, slower growth in China's economy, volatility in financial markets, and geopolitical risks.」

「Looking ahead, the outlook for the global and Japanese economies is extremely difficult to predict due to the destabilization of international political conditions, including in the Middle East and Ukraine, the United States' protectionist trade policies, soaring energy and resource prices, and unstable foreign exchange movements.」

「In addition to growing instability in the international political situation, including in the Middle East and Ukraine, the outlook for the global and Japanese economies has become extremely difficult to predict due to the U.S. protectionist trade policy, soaring energy and resource prices, and increasingly volatile exchange rates.」

「During the interim consolidated accounting period, the global economy generally remained weak due to the impact of US tariff policy and geopolitical risks. In Japan, the economy was on a moderate recovery track due to improvements in employment and income conditions, but the outlook remained uncertain due to the global economic trends described above.」

「During the interim consolidated accounting period, the global economy remained unstable as geopolitical conflicts in Ukraine and the Middle East continued, while tensions between the United States and China also intensified. In Japan, the economy proceeded amid a range of difficult-to-control issues, including rising prices, yen depreciation and interest rate differentials. Concerns about the future of the Chinese economy also persisted, leaving the economic outlook uncertain.」

「During the cumulative first quarter of the fiscal year, the global economy remained in a very unstable and difficult situation as Russia's invasion of Ukraine and the conflict between Israel and Palestine continued. Financial risks related to global inflation and concerns about an economic recession expanded. In Japan, the yen continued to weaken, with no end in sight to rising import prices and overall prices. Sentiment in the Chinese economy also deteriorated, and the outlook for a recovery in weak global demand remained uncertain.」

「During the fiscal year, the global economy remained weak overall, except for the United States, where personal consumption remained firm, as the war between Ukraine and Russia continued and conflict also broke out in the Middle East, creating an unstable political environment. Energy and resource prices remained elevated, and inflation continued to expand. China's economic slowdown had a particularly significant impact, spreading uncertainty about the outlook.」

「During the cumulative third quarter of the fiscal year, the global economy saw Europe and the United States move toward monetary tightening to combat inflation while China's economy struggled with a property downturn and deflation concerns. Against this backdrop, US-China tensions cast a significant shadow, and tighter regulations targeting China had a substantial impact on corporate activity. In Japan, the unprecedented depreciation of the yen beyond ¥150 was reflected in corporate performance, producing divergent results across industries.」

「During the cumulative second quarter of the fiscal year, while countries proceeded with monetary tightening to combat inflation, the Bank of Japan stood out as the only central bank continuing large-scale monetary easing, and the yen depreciated sharply further against most currencies, including the dollar and euro. In addition, as the war in Ukraine became protracted, tensions between the United States and China expanded into multiple areas, and various transaction restrictions advocated on the grounds of economic security became a factor slowing the recovery of the global economy, leaving the outlook for the global economy uncertain.」

「During the cumulative first quarter of the fiscal year, the global economy remained in a severe and uncertain environment as the prolonged invasion of Ukraine expanded financial risks arising from countries' monetary tightening policies aimed at addressing global inflation, as well as concerns about an economic recession.」

「Inflation spread rapidly worldwide as the invasion of Ukraine by Russia drove up energy and resource prices. China, which had maintained its zero-COVID policy, was forced into a recession after repeated severe movement restrictions and lockdowns.」

「During the cumulative third quarter of the fiscal year, the global economy generally showed signs of recovery. However, the rapid spread of global inflation due to higher and persistently elevated resource prices amid the renewed spread of COVID-19 and the prolonged invasion of Ukraine, together with rising energy and food prices, continued to make the outlook uncertain. Shortages of electronic components, particularly semiconductors, and sharp foreign exchange movements also contributed to the uncertainty.」

「During the cumulative second quarter of the fiscal year, in addition to COVID-19, which showed no signs of converging, soaring energy prices accompanying Russia's invasion of Ukraine caused inflation worldwide and intensified signs of a slowdown in the economy. China, which stubbornly continued its zero-COVID policy, caused major damage not only to supply chains through prolonged urban lockdowns but also to economic activity in Japan and overseas.」

「However, a sharp increase in COVID-19 cases in China, which maintained its zero-COVID policy, and prolonged urban lockdowns disrupted the previously strong Chinese economy. Russia's sudden invasion of Ukraine also created concerns about adverse effects on the global economy in various respects.」

「The electronic components industry continued to perform well as demand recovered after the easing of US-China trade friction, but the outlook became uncertain in the second half of the fiscal year due to semiconductor shortages, soaring resource prices and unstable logistics caused by the impact of COVID-19.」

「While economic activity was recovering in Europe and the United States, urban lockdowns were imposed in Southeast Asia due to renewed COVID-19 outbreaks, significantly affecting economic activity in the region and supply chains. In China, serious power supply problems directly affected production activity, temporarily slowing economic growth. In Japan, social and economic activity has gradually normalized following the lifting of the state of emergency. However, in manufacturing, shortages of semiconductors and other components and soaring resource prices have continued broadly amid the rapid recovery in demand, creating an uncertain outlook, including due to orders to build up inventories.」

「As the spread of infections continued unabated, economic activity remained uneven across countries and regions. While economic activity picked up in Europe and the United States, emerging economies were affected significantly, particularly in Southeast Asia, where renewed COVID-19 outbreaks led to urban lockdowns, affecting logistics and companies operating production facilities locally.」

「During the cumulative first quarter of the fiscal year, the impact on the global economy continued as the end of the COVID-19 pandemic remained out of sight and the threat of variant strains emerged. In Europe, restrictions on activity became even stricter due to the resurgence of infections, making the economic outlook difficult to predict.」

「During the fiscal year, COVID-19 spread worldwide, substantially restricting economic activity through lockdowns, travel bans and other measures.」

「During the cumulative third quarter of the fiscal year, the US economy remained stable, but the impact of the slowdown in China's economy caused by US-China trade friction persisted and spread worldwide. The European economy, already disrupted by the issue of the UK's withdrawal from the EU, also showed increasing signs of a slowdown. In Japan, the global economic slowdown directly affected the performance of many manufacturers, increasing uncertainty about the outlook for a market recovery. Concerns also arose about future consumption trends following the consumption tax increase.」

「In Japan, GDP growth for the April-June quarter fell at an annualized rate of 27.8%, the worst decline in the postwar period, raising concerns about the future employment situation and consumption trends.」

「During the cumulative first quarter of the fiscal year, the global economy deteriorated significantly due to the rapid spread of COVID-19. In Europe and the United States, the sharp increase in infections from March onward caused economic activity to stagnate and the economy to slow sharply as a result of strict travel restrictions, restrictions on residents' movement, and the closure of stores and other facilities. In China, the Lunar New Year holiday was extended to prevent the spread of infection, and most factories suspended operations. Although operations gradually resumed from March, economic activity declined substantially. Japan was no exception, with consumption falling sharply and employment and business problems spreading across all sectors.」

「During the fiscal year, the prolonged US-China trade friction brought to the surface direct impacts on the global economy, including a slowdown in global trade and restrained capital investment. Geopolitical risks, including the UK's withdrawal from the EU, rising tensions in the Middle East and the protests in Hong Kong, further amplified uncertainty about the outlook for the global economy throughout the year. In Japan, the global economic slowdown directly affected the performance of many manufacturers, raising concerns about prolonged stagnation in domestic demand. Concerns also arose about future consumption trends due to the consumption tax increase and a decline in inbound consumption.」

「During the cumulative third quarter of the fiscal year, the US economy remained stable, but the impact of the slowdown in China's economy caused by US-China trade friction persisted and spread worldwide. The European economy, already disrupted by the issue of the UK's withdrawal from the EU, also showed increasing signs of a slowdown. In Japan, the global economic slowdown directly affected the performance of many manufacturers, increasing uncertainty about the outlook for a market recovery. Concerns also arose about future consumption trends following the consumption tax increase.」

「During the cumulative second quarter of the fiscal year, the company was directly affected in both the Chinese and domestic markets by the deterioration and prolonged weakness of the Chinese economy caused by US-China trade friction, as well as the resulting stagnation in Japan's electronics industry. The company had expected US-China relations to improve and the global economy to resume firm growth from the second half of the year, but developments moved in the exact opposite direction, increasing uncertainty about the outlook for the business environment.」

「Growth in emerging economies such as China and India also began to show signs of weakening, raising concerns about a slowdown in the global economy as a whole. In Japan, despite concerns including labor shortages and rising raw material prices, domestic demand remained relatively steady, but weakness in exports and production raised fears of an economic recession.」

「During the cumulative third quarter of the fiscal year, concerns arose over the impact of US-China trade friction on production activity and consumption trends. The US economy remained firm, supported by improving employment conditions and increases in personal consumption and capital investment. The European economy continued to perform well in both personal consumption and corporate performance, while emerging economies such as China and India generally continued to grow moderately. In Japan, despite labor shortages and rising raw material prices, personal consumption and capital investment remained firm, and the economy showed signs of a moderate recovery.」

「During the cumulative second quarter of the fiscal year, the global economy continued to grow moderately overall amid concerns about the impact of trade friction between the United States and China. The European economy remained firm in both personal consumption and corporate performance. Emerging economies such as China and India also continued to expand and remained stable overall. In Japan, despite concerns including labor shortages and rising raw material prices, both domestic and external demand remained firm, and the economy showed signs of a moderate recovery.」

「During the three-month period of the current fiscal year, concerns about trade friction arising from protectionist trade policies in the US existed, but the US economy progressed without major disruption. In Europe, exports slowed because of the stronger euro, but the economy continued its gradual recovery as monetary easing continued. The economies of emerging countries such as China and India also continued to expand, and the global economy remained generally stable. In Japan, although labor shortages and rising raw material prices were concerns, both domestic and external demand remained firm and the economy showed signs of a gradual recovery.」

「During the current fiscal year, the US economy continued to recover, supported by expanding employment and firm capital investment, while Europe also showed stable, gradual expansion. In Asia and emerging markets, China continued to expand gradually, resulting in broadly solid growth. In Japan, private consumption remained sluggish, but capital investment was firm and employment conditions improved. Supported by strong global economic conditions, the economy remained stable without major disruption.」

「During the nine-month period of the current fiscal year, the US economy remained stable, with private consumption and corporate earnings holding firm, while the European economy continued its gradual recovery. The Chinese and emerging-market economies also continued to grow steadily and remained on a gradual recovery track. In Japan, private consumption and corporate capital investment remained firm, and the economy was broadly flat as employment conditions and overseas economies stabilized.」

「The Chinese economy showed signs of recovery, supported by infrastructure investment and increased exports, while emerging-market economies continued to recover gradually as resource prices stabilized. In Japan, private consumption and corporate production activity showed signs of improvement, but the economy remained flat, partly because of labor shortages.」

「In contrast, the economies of emerging countries such as China and India remained flat because the economies of developed countries experienced no particular disruption, and the global economy was generally stable. In Japan, private consumption continued to struggle despite expanding corporate capital investment and improving employment conditions, and the economy continued to lack momentum.」

「In Japan, private consumption remained sluggish despite improvements in employment conditions. Corporate earnings and capital investment were also constrained by the sharp appreciation of the yen, while monetary and fiscal policies had yet to produce results. In addition, the uncertain economic policies of the new US administration weighed on the economy, which continued to lack momentum.」

「The European economy showed little strength, possibly because of the UK's decision to leave the European Union. The economies of emerging countries such as China and India remained stagnant, and the overall economic outlook was uncertain. In Japan, private consumption remained sluggish despite improvements in employment conditions, while the sharp appreciation of the yen slowed the growth of corporate earnings and capital investment. Monetary and fiscal policies had yet to produce results, and the economy continued to lack momentum.」

「The economies of emerging countries such as China and India continued to slow, and the overall economic outlook remained uncertain. In Japan, private consumption remained sluggish despite the recovery in corporate earnings and improvements in employment conditions since the previous year, and the economy continued to lack momentum.」