Big Japanese manufacturers' sentiment improved slightly in the three months to December, a quarterly Bank of Japan survey showed on Friday, boding well for the central bank's plans to gradually raise interest rates from near-zero levels.
Nonmanufacturers also remained upbeat on business conditions, though concerns over rising raw material and labor costs weighed on retailers' morale, the survey showed.
The data released ahead of the Bank of Japan's two-day policy meeting next week highlights how an intensifying labor shortage is becoming a headache for companies and a potential constraint to economic growth.
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