Financial Market Instability and Uncertainty over the Economic Outlook Due to the UK's Withdrawal from the EU and Other Factors

「During the current interim consolidated accounting period, the global economy was significantly affected by additional US tariffs and rising geopolitical tensions, while in Japan, tariff negotiations continued amid an unstable political situation, strengthening concerns about the outlook, particularly among exporters.」

「Meanwhile, as the invasion of Ukraine and conflict in the Middle East continued, the international economy became even more uncertain in the second half of the fiscal year because of the US policy of significantly raising import tariffs.」

「During the current interim consolidated accounting period, Japan's economy was on a recovery trend owing to the normalization of socioeconomic activity and strong inbound tourism demand. However, the situation remained uncertain because of inflation caused by higher raw-material prices and the weaker yen, natural disasters caused by abnormal weather, and, overseas, the prolonged Russian invasion of Ukraine and the expanding conflict in the Middle East.」

「However, raw-material prices have continued to rise because of increasing geopolitical risks, including the prolonged Russian invasion of Ukraine and the outbreak of the Israel-Palestine conflict, as well as the rapid depreciation of the yen, and remain a major concern.」

「During the cumulative third quarter of the current consolidated fiscal year, Japan's economy saw some restraint in personal consumption due to high prices, but face-to-face services, including leisure and inbound tourism-related businesses, recovered, while the easing of semiconductor supply constraints supported a recovery in automobile production. Overall, the economy remained on a moderate recovery trend.」

「During the cumulative second quarter of the current consolidated fiscal year, Japan's economy was supported by the recovery of leisure-related businesses following the reclassification of the novel coronavirus disease as a Category 5 disease, as well as the recovery in production of automobiles and other products accompanying the normalization of semiconductor supplies. However, the further escalation of geopolitical risks, including the situation in Ukraine, and inflation caused by persistently high raw-material prices remained major concerns.」

「During the cumulative first quarter of the current consolidated fiscal year, Japan's economy saw rapid recovery in leisure-related businesses as the novel coronavirus disease was reclassified under the law as a Category 5 disease and inbound tourism resumed, while the prolonged situation in Ukraine and continued inflationary trends remained major concerns.」

「During the cumulative third quarter of the current consolidated fiscal year, Japan's economy saw further recovery in socioeconomic activity, particularly in the leisure industry, as the seventh wave of novel coronavirus infections subsided. However, the prolonged situation in Ukraine, higher raw-material prices and inflation associated with the significant depreciation of the yen strengthened the trend toward restrained consumption, and the economic outlook remained unpredictable.」

「During the cumulative second quarter of the current consolidated fiscal year, Japan's economy saw socioeconomic activity move further toward normalization and signs of recovery, particularly in leisure demand, as the seventh wave of novel coronavirus infections reached a record high. Meanwhile, the surge in raw-material prices caused by geopolitical risks and worsening supply-chain disruption became more severe, and significant inflation in Japan and other countries around the world began to have a major impact on people's lives.」

「During the cumulative first quarter of the current consolidated fiscal year, Japan's economy was affected by higher resource prices and other factors associated with geopolitical risks that became apparent at the end of the fiscal year, while restrictions on socioeconomic activity were eased amid the COVID-19 environment as caution over the spread of the novel coronavirus disease continued.」

「However, geopolitical risks became apparent at the end of the fiscal year, affecting resource prices and the procurement of goods in Japan, which is heavily dependent on the global economy, and the situation is expected to remain unpredictable for business development.」

「Overseas, infections have been spreading rapidly because of a new variant, raising concerns that it could enter Japan. In addition, production and logistics disruptions caused by the rapid spread of infections overseas, shortages of raw materials and rising resource prices are beginning to affect companies' business activities.」

「During the cumulative second quarter of the current consolidated fiscal year, Japan's economy saw the fifth wave of novel coronavirus infections, which had been spreading since last year, peak in August, while restrictions on socioeconomic activity under states of emergency and priority preventive measures continued. Overseas, the situation also remained unpredictable, with infections rapidly spreading again, particularly in Southeast Asia, where the group has subsidiaries.」

「During the cumulative first quarter of the current consolidated fiscal year, Japan's economy remained subject to restrictions on socioeconomic activity under states of emergency and priority preventive measures while the novel coronavirus disease, which has been spreading since last year, showed no clear prospect of containment. Overseas, the situation also remained unpredictable, with infections rapidly spreading again in regions where they had temporarily subsided.」

「However, since December last year, restrictions on economic activity have again been intensifying, including the decision to temporarily suspend the Go To Travel campaign amid a sharp increase in infections.」

「However, Japan's economy remained in a difficult situation because the domestic situation remained unpredictable, with no clear prospect of containing the disease, while signs of renewed spread emerged mainly in Europe and the United States and the global economy continued to stagnate.」

「During the cumulative first quarter of the current consolidated fiscal year, Japan's economy was significantly restricted in its socioeconomic activity following the declaration of a state of emergency in response to the rapid spread of the novel coronavirus disease. Overseas, lockdowns and other measures were also implemented, particularly in developed countries, and the global economy remained severely stagnant.」

「However, the rapid spread of the novel coronavirus disease since the beginning of this year has had a severe adverse impact on the global economy, and its impact is expected to increase further.」

「During the cumulative third quarter of the current consolidated fiscal year, Japan's economy saw global equity markets rise following progress in US-China trade negotiations, while concerns about the impact of the consumption tax hike, successive natural disasters and increasing tensions in the Middle East and East Asia kept uncertainty about the outlook high.」

「During the cumulative second quarter of the current consolidated fiscal year, Japan's economy remained subject to concerns about the impact on the global economy of escalating trade friction, particularly between the United States and China, and growing political instability in the Middle East, the EU and Hong Kong, among other areas. Uncertainty about the outlook for the domestic economy also increased.」

「During the three-month period ended the first quarter, concerns arose over the impact of US-China trade friction on corporate performance and changes in consumer sentiment ahead of the consumption tax increase, resulting in a situation of further increasing uncertainty over the outlook.」

「At the same time, uncertainty over the economic outlook increased due to intensifying US-China trade friction, a slowdown in the Chinese economy, political instability in countries including the UK due to Brexit and the consumption tax increase scheduled for October of the current year.」

「During the nine-month period ended the third quarter, the impact of US-China trade friction gradually became apparent in Japan’s economy, increasing uncertainty over the outlook. In addition, political instability in countries including the UK due to the Brexit issue became a major concern for the global economy.」

「During the six-month period ended the second quarter, the Japanese economy remained firm, with the stock market reaching a post-bubble high, while the impact of successive natural disasters on economic activity continued. In addition, concerns including US-China trade friction and higher raw material costs increased uncertainty over the outlook.」

「During the three-month period ended the first quarter, Japan’s economy remained supported by firm domestic corporate performance, while concerns arose over the impact of trade policies and political situations in countries around the world, increasing uncertainty over the outlook.」

「At the same time, uncertainty over the future of the international situation is increasing due to concerns about policy trends in countries around the world and geopolitical risks, particularly in Asia and the Middle East.」

「At the same time, uncertainty over the outlook has increased due to rising geopolitical risks and increasing instability in the political situations in Europe and the United States.」

「In addition, concerns have arisen over the impact on the domestic economy of increasingly fluid political situations in Japan and overseas and rising geopolitical risks in East Asia and elsewhere.」

「In addition, concerns have arisen over increasing instability in the political situations in Europe and the United States and geopolitical risks in East Asia, and cautious views of the outlook are becoming more widespread.」

「During the current consolidated fiscal year, Japan’s economy faced major changes in the international situation, including stagnation in emerging economies, the UK’s decision to leave the EU and the inauguration of the new US administration. In the United States in particular, while the new administration’s policy direction remained uncertain, expectations for economic policy increased, supported by firm economic indicators, contributing to signs of a recovery in the global economy. In Japan, although the recovery lacked strength, business performance was on a recovery trend, particularly in manufacturing, partly as a result of companies’ efforts.」

「With respect to the global economy, uncertainty has increased further due to the inauguration of the new US administration, Brexit and slower growth in emerging markets, among other factors.」

「During the six-month period ended the second quarter, corporate earnings remained firm, supported by economic and financial policies, and employment conditions continued to improve. At the same time, uncertainty over the economic outlook was increasing due to Brexit and slower growth in emerging economies.」

「During the three-month period ended the first quarter, Japan’s economy saw financial markets become increasingly unstable due to the postponement of the consumption tax increase and the Brexit issue, among other factors. Stock prices fell and the yen appreciated, further increasing uncertainty over the economic outlook.」