Downside risk to the economy from international developments and financial and foreign-exchange volatility

「The expansion of inbound consumption, U.S. trade policy, the situation in Ukraine and exchange-rate conditions are expected to affect the sales environment for food products in general, including the marine products handled by our Group.」

「Meanwhile, the business environment remains uncertain due to the prolonged situation involving Russia and Ukraine, conflicts in the Middle East, soaring energy and raw-material prices, exchange-rate volatility resulting from policy rate hikes in Europe and the United States, and the continuing decline in the birth rate, population aging and labor shortages in Japan.」

「In addition to the impact of measures by the Chinese government to suspend imports of Japanese marine products, prices for certain fish species declined, resulting in a year-on-year decrease in operating profit.」

「Profit margins declined due to falling prices for certain fish species and higher import costs resulting from the weaker yen.」

「As the situation in Ukraine continued, global prices for energy, food and other commodities remained high. While major developed countries, led by the United States, raised interest rates to contain inflation, the foreign exchange market recorded a 32-year low for the yen in October, with the U.S. dollar trading in the ¥151 range. However, after the Bank of Japan decided in December to widen the upper limit of its tolerance range for long-term interest rates, raising it from approximately 0.25% to approximately 0.5%, the exchange rate moved sharply toward a stronger yen and weaker U.S. dollar. The dollar fell into the ¥130 range for the first time in four months, since mid-August, and the foreign exchange market remained highly volatile, leaving the outlook uncertain.」

「During the six-month period ended [the current second quarter], Japan’s economy remained uncertain as major developed countries, led by the United States, raised interest rates to contain inflation, while the Bank of Japan continued its monetary easing policy, resulting in a sharp depreciation of the yen against the U.S. dollar. Energy and food prices rose as the situation between Russia and Ukraine continued, and the risk of an economic downturn increased due to the impact of the seventh wave of COVID-19, when the number of daily cases exceeded 200,000.」

「Meanwhile, stagnation in consumption and production resulting from China’s zero-COVID policy and soaring energy and food prices due to the prolonged invasion of Ukraine have become factors behind record inflation in countries around the world. In addition, the weaker yen against the U.S. dollar resulting from U.S. monetary policy has driven up import costs in Japan and has become a downside risk to the economy.」

「The impact of COVID-19, the situation in Ukraine and exchange-rate conditions are expected to affect the sales environment for food products in general, including the marine products handled by our Group.」

「The global economy remains uncertain, with concerns that U.S.-China trade friction and the United Kingdom’s withdrawal from the EU will adversely affect future growth, in addition to the spread of COVID-19.」

「During the third quarter cumulative consolidated period, the Japanese economy maintained moderate growth as corporate earnings remained high and employment and income conditions continued to improve. However, concerns that U.S.-China trade friction and escalating tensions in the Middle East could slow global economic growth have left conditions uncertain.」

「During the second quarter cumulative consolidated period, the Japanese economy continued to recover moderately as corporate earnings remained high and employment and income conditions continued to improve. However, concerns that U.S.-China trade friction and other factors could slow global economic growth have left conditions uncertain.」

「During the first quarter cumulative consolidated period, the Japanese economy continued on a moderate recovery track, supported by solid corporate earnings and improvements in employment and income conditions. However, concerns that U.S.-China trade friction could slow global economic growth have left conditions uncertain.」

「During the current consolidated fiscal year, the Japanese economy was on a moderate recovery track, with improvements in corporate performance and employment conditions. However, concerns that U.S.-China trade friction and the UK's Brexit issue could adversely affect the global economy have left conditions uncertain.」

「Trade frictions stemming from the protectionist trade policies of the Trump administration in the United States are also expected to pose a risk of weighing on the global economy, leaving conditions uncertain.」

「Overseas, protectionist trade policies by the Trump administration in the United States also pose a risk of weighing on the economy, leaving conditions uncertain.」

「During the first quarter cumulative consolidated period, the Japanese economy continued on a moderate recovery track due to high corporate earnings and improvements in employment and income conditions. However, disruption from the Trump administration's trade policies in the United States and downside risks to the Chinese economy have left conditions uncertain.」

「Meanwhile, the business environment has remained challenging, as labor shortages have pushed up logistics costs and continued consumer thrift has caused sales of high-priced products to stagnate.」

「During the third quarter cumulative consolidated period, the Japanese economy was recovering on the back of continued improvements in corporate performance and employment conditions, and economic recovery also continued in Europe and the United States. However, concerns including higher personnel costs due to worsening labor shortages and delays in wage growth have left conditions uncertain.」

「During the second quarter cumulative consolidated period, the Japanese economy was gradually recovering on the back of continued improvements in corporate performance and employment and income conditions. However, concerns over labor shortages and instability related to the policies of the Trump administration in the United States have left the outlook uncertain.」

「However, changes in trade policy, including the United States' withdrawal from the TPP, and the outcome of national elections scheduled in various European countries this year could destabilize the global economy, leaving little room for optimism.」

「However, economic uncertainty, including the unstable situation in the Middle East, the UK's Brexit issue, and financial and foreign-exchange volatility, poses a downside risk to the economy, and conditions of uncertainty about the outlook continue.」