TDB Trends Research (Nationwide, Research & Summary for December 2023)

The domestic economy gradually improved
due to solid year-end demand～ In 2024, attention must be paid to the future of wage increases
and interest rate trends, and there are concerns about
the impact of the Noto Peninsula Earthquake ～(Companies researched: 27,143; Valid responses: 11,407; Response rate: 42.0%; Survey
start date: May 2002)

e-mail：keiki@mail.tdb.co.jp< Trend in December 2023: Slight improvement continues >The economic diffusion index (DI) in December 2023 was 44.9, up 0.1
points from the previous month, for a third straight month ofimprovement.
While year-end demand was solid, a slump in seasonal products causedby the warm winter and the automaker's fraud were negative factors.

By industry: Supported by year-end demand, improvements were madein 6 industries including “transportation, warehousing” and “retail”.
By scale: Although “small to medium-sized firms” and “micro firms”
improved slightly, polarization within each scale group continued.
By region: While improvements were made in 5 out of 10 regions, there
are concerns about the earthquake impact.

< Future outlook: Remain unchanged >The domestic economy is expected to remain unchanged due tosustained wage increases and interest rate trends.

55
5045

43.0

43.9 44.6

45.4 45.0 45.2 44.9

44.4 44.7 44.8 44.9 45.0 45.3 45.4 45.1 45.0 45.2 45.5

45.6 45.8 45.8 46.0

46.1

42.1 42.1

40After 3 months
After 1 month

After 6 months

After 1 year

35
（Prediction→）

300

JulJulAug Sep Oct Nov Dec Jan Feb Mar Apr May Jun
Aug Sep Oct Nov Decyy2022
2023
2024
Projected future DI
43.0 42.1 42.1 43.9 44.6 45.4 45.0 45.2 44.9 44.4 44.7 44.8 44.9 45.0 45.3 45.4 45.1 45.0 45.2 45.5 45.6 45.8 45.8 46.0 46.1
Change from December.2023
0.1 0.4 0.5 0.2 0.1 0.3 0.6 0.7 0.9 0.9 1.1 1.2
Upper
46.7 47.2 47.5 47.3 47.3 47.6 48.0 48.2 48.4 48.6 48.7 48.9*: The economic forecast DI is calculated using the Forecast Combination method of the results of the ARIMA model and the structural equation model.
Lower43.3 43.4 43.4 42.9 42.7 42.8 43.0 43.1 43.1 43.1 43.3 43.4
Dec

©TEIKOKUDATABANK,LTDJanFebMarAprMayJun

TDB Trends Research December 20231

Economic Diffusion Index (Economic DI)1/2
Ratio to the
Dec-22 Jan-23 Feb-23 Mar-23 Apr-23 May-23 Jun-23 Jul-23 Aug-23 Sep-23 Oct-23 Nov-23 Dec-23

PreviousMonthTotal

43.0 42.1 42.1 43.9 44.6 45.4 45.0 45.2 44.9 44.4 44.7 44.8 44.90.1

Large Firms

44.8 44.8 44.2 46.1 47.3 48.1 47.7 48.6 48.0 47.8 47.9 48.4 48.1

▲ 0.3

Small to Medium-sized Firms

42.6 41.6 41.7 43.5 44.2 44.9 44.5 44.6 44.3 43.8 44.1 44.2 44.3

0.1

Micro Firms

41.3 40.4 40.9 42.4 42.9 43.9 43.6 43.4 43.5 43.0 43.4 43.1 43.3

0.2

Ratio to theDec-22 Jan-23 Feb-23 Mar-23 Apr-23 May-23 Jun-23 Jul-23 Aug-23 Sep-23 Oct-23 Nov-23 Dec-23

Previous
Month

Agriculture,Forestry,Fisheries

37.9 37.4 38.9 41.6 42.2 44.8 46.7 42.5 43.0 42.1 43.0 40.1 40.5

0.4

Finance44.3 44.8 43.3 44.0 45.0 47.8 48.1 47.4 48.8 46.8 47.3 48.0 47.0

▲ 1.0Construction

44.6 44.1 43.7 45.5 45.6 46.9 46.8 47.8 47.4 47.1 47.5 47.8 47.2

▲ 0.6

Real Estate

44.8 46.1 46.3 47.5 49.6 50.7 50.3 48.8 49.6 48.5 48.7 47.9 47.5

▲ 0.4

Food,BEWerages,Livestock Feed38.3 38.1 37.0 41.1 42.0 43.7 43.6 43.1 44.5 42.6 43.4 44.0 44.6

0.6

Textile,Textile Products,Clothing

37.9 37.7 39.0 38.6 41.0 42.1 42.0 43.6 42.6 43.0 41.5 40.8 40.1

▲ 0.7

Ceramics,Stone and Clay Products41.0 38.0 37.6 37.0 39.7 39.0 38.4 37.9 38.2 39.0 40.3 41.5 40.3

▲ 1.2

Pulp, Paper and Paper Products

39.2 39.8 36.6 38.6 37.6 38.6 35.8 36.1 36.1 36.9 37.7 37.2 38.5

1.3

Publishing,Printing

32.4 31.7 31.6 34.3 33.9 35.4 33.9 33.4 33.9 32.3 32.5 33.1 34.2

1.1

Chemical41.5 40.3 39.2 40.1 41.0 40.6 41.6 41.8 41.2 41.2 41.4 42.7 42.2

▲ 0.5

Steel,Nonferrous Metals,Mining

43.1 41.7 41.0 41.9 41.1 40.9 40.4 40.7 39.9 39.8 41.5 41.9 42.0

0.1

General Machinery

44.9 43.3 43.7 43.4 43.8 42.9 41.9 42.9 42.8 41.2 40.7 40.5 40.6

0.1

Electrical Machinery

44.5 43.3 43.2 42.8 43.2 43.1 43.9 42.9 42.8 42.4 42.3 43.0 42.5

▲ 0.5

Transportation Machinery,Equipment

41.0 38.7 39.6 41.2 41.5 43.0 44.6 46.2 46.2 48.3 46.9 47.2 44.7

▲ 2.5

Medical Instruments and Equipment

46.3 46.5 49.0 46.8 45.6 46.2 46.8 45.4 42.9 44.2 42.9 43.4 44.3

0.9

Other

37.0 39.1 36.1 40.8 41.9 42.7 42.3 43.8 40.3 40.5 39.4 40.7 39.9

▲ 0.8

41.5 40.4 40.0 41.0 41.4 41.5 41.3 41.5 41.2 40.8 41.1 41.6 41.5

▲ 0.1

Food,BEWerages

38.2 37.5 38.3 42.1 44.3 45.2 44.9 46.4 47.1 45.8 43.3 44.5 45.7

1.2

Textile,Textile Products,Clothing

34.0 34.7 35.9 38.0 41.9 43.1 39.4 39.5 38.0 38.1 36.1 36.0 36.3

0.3

40.2 38.3 37.2 38.0 39.1 38.4 37.3 38.4 38.0 38.1 38.0 38.3 38.90.6

Paper Products,Stationery,Books

33.8 34.8 35.6 37.3 37.9 40.3 36.5 38.2 38.6 38.5 38.4 40.1 40.7

0.6

Chemical

43.5 42.8 41.7 43.5 44.9 46.8 45.3 45.2 45.1 44.5 44.9 45.1 45.4

0.3

Recycled Resources46.2 43.3 43.2 41.7 43.5 40.4 38.9 42.2 40.9 43.9 45.2 42.4 43.8

1.4

Mining Products

39.9 38.5 37.1 37.8 37.9 38.1 37.5 37.9 34.7 36.7 37.0 38.1 38.2

0.1

Machinery,Equipment

43.8 43.0 43.3 45.2 45.2 46.0 45.4 45.3 44.7 43.8 43.9 44.1 44.7

0.6

Other

40.9 40.0 40.9 42.3 43.9 44.9 43.2 42.6 42.7 41.7 43.1 43.2 42.9

▲ 0.3

41.0 40.1 40.1 41.9 42.9 43.7 42.5 42.9 42.3 41.9 41.7 42.1 42.7

0.6

Construction Materials,Furniture,

Manufacturing

Precision Machinery,

Total

Construction Materials,
Furniture,Ceramics,
Stone and Clay Products

Wholesale

Steel,Nonferrous Metals,

Total©TEIKOKUDATABANK,LTD

TDB Trends Research December 2023

2

Economic Diffusion Index (Economic DI)2/2
Ratio to the
Dec-22 Jan-23 Feb-23 Mar-23 Apr-23 May-23 Jun-23 Jul-23 Aug-23 Sep-23 Oct-23 Nov-23 Dec-23

PreviousMonthRetailFood,BEWerages

42.2 42.3 40.6 42.7 49.1 49.7 46.6 46.2 47.8 46.5 45.5 44.9 46.4

1.5

Textile,Textile Products,Clothing

35.4 34.2 35.7 39.7 36.6 38.3 40.4 41.4 41.2 36.6 42.7 39.3 40.0

0.7

Drugs,Sundries

39.0 37.2 38.5 42.9 47.8 47.4 45.9 45.3 42.6 42.5 43.8 44.7 46.1

1.4

Furniture

31.0 34.2 33.3 39.5 38.1 34.7 33.3 32.5 30.2 36.3 27.2 32.4 32.7

0.3

Information Machinery and Equipment

37.2 36.3 37.5 40.2 37.8 40.5 38.6 41.3 40.2 42.7 42.5 44.0 42.7▲ 1.3

Motor Vehicles,Motor Vehicle Parts

35.3 38.2 38.7 40.8 44.0 41.5 40.6 40.9 42.0 41.7 42.4 40.2 39.7

▲ 0.5

Special Merchandise

34.8 34.4 35.3 38.6 39.0 39.4 40.1 38.8 38.7 39.1 39.4 38.1 38.3

0.2

Various Merchandise

42.6 42.5 41.0 43.6 47.8 45.8 44.9 48.1 48.5 45.9 45.3 44.3 44.1

▲ 0.2

Other

41.1 42.3 44.8 41.1 41.7 41.1 45.8 46.2 42.2 47.6 46.2 47.2 51.3

4.1

37.4 37.5 37.7 40.6 42.5 42.4 42.0 41.9 41.8 41.4 41.9 41.2 41.5

0.3

41.6 38.9 38.0 41.2 42.1 43.4 42.2 43.5 43.3 42.8 44.1 43.8 44.5

0.7Electrical Household Appliances,

Total

Transportation,Warehousing

Service

Restaurants

41.5 38.5 42.4 49.8 50.8 56.7 53.6 55.6 52.2 51.8 47.4 49.4 54.0

4.6

Postal,Telecommunications

48.3 47.6 44.4 52.8 52.8 58.3 53.3 60.4 54.8 57.4 59.5 57.1 54.2

▲ 2.9

Electricity,Gas,Water,Heat

36.7 32.4 32.1 39.7 38.9 44.0 44.1 44.8 43.5 46.3 44.1 50.0 42.7

▲ 7.3

Leasing,Rentals

47.4 46.8 47.4 48.1 50.5 49.7 52.1 49.8 49.0 49.2 52.5 52.9 51.6

▲ 1.3

Lodging, Hotels

52.2 48.3 48.0 59.5 62.1 59.8 55.1 56.6 55.5 57.6 59.7 64.3 56.9

▲ 7.4

Recreation

43.2 42.1 44.1 50.9 48.9 50.4 47.6 49.3 48.8 46.2 46.3 44.8 47.9

3.1

Broadcasting

39.5 40.7 41.1 42.6 44.7 47.4 43.1 44.7 46.1 45.6 42.6 45.6 43.3

▲ 2.3

Maintenance,Guarding,Testing

45.6 42.9 42.6 45.3 45.8 47.3 48.0 48.4 47.4 47.8 46.8 49.0 46.9

▲ 2.1

Advertising39.7 40.2 41.4 43.7 46.6 45.0 45.0 44.8 45.2 45.4 45.2 45.6 45.1

▲ 0.5

Information

53.6 53.2 53.8 55.5 55.8 56.2 56.8 57.0 56.4 55.5 56.0 55.4 56.3

0.9

Labor Dispatching

50.0 48.5 47.9 47.3 49.6 50.7 52.0 52.0 50.9 48.9 50.9 52.3 50.0

▲ 2.3

Special Services

48.7 48.5 49.2 50.1 50.9 52.3 51.7 52.2 51.3 51.2 52.0 51.1 50.3

▲ 0.8

Medical,Welfare,Public Health42.8 42.9 41.5 42.2 41.8 44.6 44.8 44.2 43.4 42.4 43.6 41.8 43.2

1.4Education

41.2 38.4 41.9 44.4 38.4 42.2 41.4 40.7 43.8 46.4 45.6 42.6 44.4

1.8

Other

44.0 42.2 44.3 46.5 48.6 47.5 49.2 48.2 47.9 47.2 47.6 47.2 48.1

0.9

47.7 46.6 47.4 50.0 50.8 51.6 51.6 51.7 50.8 50.4 50.8 50.8 50.9

0.1

36.7 36.5 37.0 38.2 39.2 41.2 39.8 40.9 40.8 39.2 40.1 38.2 42.8

4.6

Total

Other

Ratio to the
Dec-22 Jan-23 Feb-23 Mar-23 Apr-23 May-23 Jun-23 Jul-23 Aug-23 Sep-23 Oct-23 Nov-23 Dec-23

PreviousMonth

Hokkaido40.8 40.1 40.6 41.2 42.2 43.0 43.9 45.6 44.8 43.6 43.7 43.3 43.3

0.0

Tohoku39.4 38.0 37.2 41.1 41.2 41.6 41.7 42.1 41.8 41.5 41.4 41.3 40.3

▲ 1.0

kitakanto

43.1 40.9 41.4 42.6 43.3 43.4 42.8 43.1 43.1 42.9 43.0 42.6 43.0

0.4

minamikanto

44.7 44.1 43.9 45.7 46.7 47.2 47.2 47.4 46.6 46.4 46.3 46.7 46.6

▲ 0.1

Hokuriku

42.2 40.9 41.2 42.1 42.5 44.0 43.7 43.6 43.1 42.5 42.1 42.3 42.5

0.2

Tokai41.7 41.0 41.1 42.8 43.3 44.6 43.8 44.4 44.4 43.6 44.4 45.1 44.8

▲ 0.3

Kinki

42.7 42.0 41.8 43.6 44.3 45.4 43.9 43.8 43.6 43.2 43.7 44.1 44.6

0.5

Chugoku43.4 41.9 41.8 44.1 44.8 44.9 44.7 45.3 44.3 44.1 44.9 44.2 43.9

▲ 0.3

Shikoku39.3 39.0 38.6 40.0 40.7 43.0 41.7 42.6 41.8 41.2 41.4 41.3 42.5

1.2

Kyushu44.8 44.0 44.8 46.4 48.1 48.5 48.2 48.0 48.3 47.7 48.6 48.7 49.00.3©TEIKOKUDATABANK,LTDTDB Trends Research December 2023

3Appendix

1.Research Subjects(Companies researched: 27,143; Validresponses: 11,407; Response rate: 42.0%)
1.Region
Hokkaido
TohokukitaKantominamikanto
Hokuriku

528
799
909
3,346
590

Kyushu

1,215
1,897
759
373
991

Total

11,407

Tokai

Kinki
Chugoku
Shikoku

2.Industry (10 Industries 51 Lines of business)
Agriculture,Forestry,Fisheries

109

Food,Beverages

Finance163

Textile,Textile Products,Clothing

90

Drugs,Sundries

55

Furniture

26

Construction

1,720

Real Estate

501
Food,Beverages,Livestock Feed

331

Textile,Textile Products,Clothing

109

Motor Vehicles,Motor Vehicle Parts

120

Construction Materials,Furniture,Ceramics,Stone and Clay Products

215

Special Merchandise

234

90

Various Merchandise

51

Pulp, Paper and Paper Products

Manufacturing（2,823）Wholesale（2,586）

Retail（792）153Electrical Household Appliances,Information Machinery and Equipment

Publishing,Printing

163

Chemical

373

Transportation,Warehousing

485

Steel,Nonferrous Metals,Mining

498

Restaurants

120

General Machinery

465

Telecommunications

Electrical Machinery

316

Electricity,Gas,Water,Heat

Transportation Machinery,Equipment

114

Leasing,Rentals

107

Precision Machinery,Medical Instruments and Equipment

73

Lodging, Hotels106

Others76

Recreation

119

Food,Beverages

334

Textile,Textile Products,Clothing

158

Construction Materials,Furniture,Ceramics,Stone and Clay Products
Paper Products,Stationery,Books
ChemicalRecycled Resources

13

OthersService（2,191）

12
16

15

Broadcasting
Maintenance,Guarding,Testing

202

297

Advertising

102

122

Information

568

249

Labor Dispatching

90

32

Special Services

346
129

Steel,Nonferrous Metals,Mining Products

255

Medical,Welfare,Public Health

Machinery,Equipment820

Education

Others319

Others42217
37

OthersTotal

3.Size50

Large Firms

1,744

15.3%

Small to Medium-sized Firms

9,663

84.7%

micro Firms

3,792

33.2%

Total

11,407100.0%©TEIKOKUDATABANK,LTD

11,407

TDB Trends Research December 2023

4

2.Research Items

An economic DI of 50 is the point separating good and bad, so a DI over
50 means “good,” and below 50 means “bad.” (The numbers are rounded
off to one decimal place.) No weight is given according to a company's size,and calculations are made on the basis of “one company, one vote.”*Business Confidence (current, in 3 months, in 6 months, in 1 year)*Business Conditions (sales, purchasing and selling unit price, inventory, capacity
utilization ratio, number of employees, overtime work hours).Size Classification

3.Research Period and Methodology

Internet-based survey conducted December 18 2023 – January 5 2024

Industry

The explanation of the Economic Diffusion Index
Research Purpose/Researched Terms
TDB Economic Trend Research (started from May 2002) is a monthly
statistical survey conducted for over 27,000 nationwide corporations on theirgeneral business activities including the current condition and future outlookof the industry business performance and operating climate. The primary
purpose of such a survey is to assess the current state of Japan’s economy.
Selection of the Subject Corporations
Companies of all sizes in all domestic industries are eligible to participate inthe survey.

Manufacturing andOther Industries*
W holesale Trade
Retail Trade
Service**

Large Firm s

Sm all to Medium -Sized Firm s(Micro Firm s included)

Capital: More than 300 m illion yen
andNo. of Em ployee: Over 300
Capital: More than 100 m illion yen
andNo. of Em ployee: Over 100
Capital: More than 50 m illion yen
andNo. of Em ployee: Over 50
Capital: More than 50 m illion yenandNo. of Em ployee: Over 100

Capital: Below 300 m illion yenor
No. of Em ployee: Below 300
Capital: Below 100 m illion yenor
No. of Em ployee: Below 100
Capital: Below 50 m illion yenor
No. of Em ployee: Below 50
Capital: Below 50 m illion yenor
No. of Em ployee: Below 100

Micro Firm s

No. of Em ployee: Below 20
No. of Em ployee: Below 5
No. of Em ployee: Below 5
No. of Em ployee: Below 5

Note1: Large Firm s refer to com panies that rank in the top 3% in term s of sales volum e according to the type of business, am ong sm all to m idium -sizedcorporations excluding m icro firm s, which are defined in Sm all and Medium Enterprises Basic Act.
Note2: Sm all to Medium -Sized Firm s refer to com panies that rank in the bottom 50% in term s of sales volum e according to the type of business, am ong
those not categorized as sm all to m idium -sized corporations in Sm all to Medium -Sized Enterprises Basic Act.

DI Calculation
The DI（Diffusion Index）is calculated by multiplying the number of responses
for each assessment category by the number given in parentheses in thetable below, to a seven-level assessment rated by companies.
Selection category Extremely good

good

fairly goodneither good nor bad

fairly badbadvery badpoints

6543210

number of responses
for each category

N6N5N4N3N2N1N0

Economic DI＝

Total of (Points for each category × Number of responses for each category)∑≡

Number of valid responses N
6i≡0i × Ni

N×16×16× 100

× 100©TEIKOKUDATABANK,LTDTDB Trends Research December 20235