Japan’s services sector sentiment index rose to 47.0 in September 2026 from 46.4 in August, its highest level since February and above market expectations of 46.8. This marked the fifth straight month of improvement, driven by stronger sentiment among household-related businesses—particularly in services—even as housing-related indicators softened.
In contrast, corporate confidence eased, dragged down by weaker sentiment in the manufacturing sector, although labor market conditions continued to improve.
The economic outlook index, which measures business expectations for the coming months, declined to 47.4 from August’s six-month high of 48.3, its first drop in five months. The deterioration reflected mounting concerns about the impact of natural disasters and heightened uncertainty over conditions in the Middle East, even as the broader economy continued to show signs of recovery.
