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Bank of Japan's Tankan to surprise on the upside

Japan’s Business Outlook Survey (BOS), released this morning, has allowed us to firm up our forecast for the Q2 Tankan survey, released on 1st July. We now forecast that the headline index (current conditions reported by large manufacturers) will rebound from -58 to -25. While this would still be weak by past standards, the outlook indices should signal a further sharp improvement in Q3.

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