Sentiment among Japan's major manufacturers turned positive in September as firms recovered from the impact of the country's March disasters, the central bank said in its Tankan survey yesterday.
But while the statistic returned to positive levels for the first time since the earthquake, tsunami and nuclear crisis, it remained below pre-disaster figures.
Worries over a strong yen, the eurozone debt crisis and a slowdown in the United States were responsible, analysts said.
Large manufacturer sentiment in September rose to two from minus nine in June, the quarterly survey showed, slightly lower than a market forecast of three. The sentiment of medium and small-sized firms remained negative.
The figures represent the percentage of companies saying business conditions are good minus those saying conditions are bad, with a positive reading illustrating that optimists outweigh pessimists.
The survey, which is taken into account by the Bank of Japan when formulating monetary policy, saw large manufacturers forecast a reading of four in December, signalling expectations that conditions would continue to improve.
However, this was below a December 2010 reading of five before the March quake.
"Companies are cautious," said Satoshi Osanai, economist at Daiwa Institute of Research.
"Today's data is [merely] confirmation that lost production has recovered. Confidence has not recovered to pre-quake levels."
The March disasters devastated entire towns along the northeast coast, left 20,000 people dead or missing and triggered the worst nuclear accident since Chernobyl in 1986, while also wreaking havoc on industry.