have been observed, such as in china ( chart 3 ). business sentiment in the manufacturing sector in the september tankan ( short - term economic survey of enterprises in japan ) has become clearly cautious, reflecting weakness in external demand and related production. as for the outlook, external demand is likely to continue to show some weakness for the time being due to the delay in the timing of a pick - up in overseas economies. on the other hand, domestic demand has remained firm. in the september tankan, business sentiment of the nonmanufacturing sector has maintained a relatively high level. among components of domestic demand, business fixed investment has continued on an uptrend ( chart 4 ). business fixed investment plans in the september tankan were steady, exceeding the average of past september surveys. specifically, while machinery investment has been somewhat weak in the manufacturing sector due to the effects of the slowdown in overseas economies, it has remained steady in the nonmanufacturing sector. in the nonmanufacturing sector, not only machinery investment but also software investment has seen an acceleration in its growth pace, reflecting strong demand for saving labor and improving efficiency. research and development ( r & d ) investment has maintained its pace of increase in a wide range of industries, including those related to exports. construction investment also has continued on an uptrend, mainly on the back of urban development projects and the construction of logistics facilities accompanying the spread of e - commerce. with regard to the outlook, business fixed investment is projected to see a temporary deceleration in its pace of increase, mainly in the manufacturing sector, reflecting the effects of the slowdown in overseas economies. however, amid accommodative financial conditions, it is expected to continue increasing moderately thereafter, mainly for investments that are relatively less susceptible to the effects of changes in overseas demand, such as investment for urban development projects, labor - saving investment, and r & d investment for growth areas. such steady business fixed investment seems to be attributable to changes in firms'behavior, which has become positive in terms of taking future business opportunities and addressing long - term challenges because the moderate expanding trend in japan's economy has continued for a few years and a sustained decline in prices is no longer observed. private consumption has increased moderately ( chart 5 ). the impact of the consumption tax hike is likely to be smaller than that of the previous tax hike in 2014, mainly because the net burden on households is small and various

boj's conduct of monetary policy assessment of economic activity and prices from two perspectives the first perspective examining the outlook for economic activity and prices deemed most likely by the bank of japan the second perspective examining, in a longer term, various risks that are most relevant to the conduct of monetary policy excerpt from september 2019 statement on monetary policy the bank will continue with " quantitative and qualitative monetary easing ( qqe ) with yield curve control, " aiming to achieve the price stability target of 2 percent, as long as it is necessary for maintaining that target in a stable manner.... in particular, in a situation where downside risks to economic activity and prices, mainly regarding developments in overseas economies, are significant, the bank will not hesitate to take additional easing measures if there is a greater possibility that the momentum toward achieving the price stability target will be lost. given that, recently, slowdowns in overseas economies have continued to be observed and their downside risks seem to be increasing, the bank judges that it is becoming necessary to pay closer attention to the possibility that the momentum toward achieving the price stability target will be lost. taking this situation into account, the bank will reexamine economic and price developments at the next mpm, when it updates the outlook for economic activity and prices. iii. the bank's conduct of monetary policy chart 12 boj's forward guidance boj decided on a new forward guidance for the policy rates ( oct. 2019 ) as for the policy rates, the bank expects short - and long - term interest rates to remain at their present or lower levels as long as it is necessary to pay close attention to the possibility that the momentum toward achieving the price stability target will be lost. first point : clearly related to the momentum toward achieving the price stability target. second point : clarified that there was " a downward bias " in the policy rates.