The Bank of Japan's latest Tankan survey shows that business sentiment among the country's major manufacturers has improved for the first time in seven quarters.

The BOJ polled over 9,000 companies from late May to the end of June.

The closely-watched index gauging the mood among large manufacturers stands at plus 5. That's up 4 points from the previous survey in March.

A positive number indicates that more companies are optimistic about business conditions than those taking a negative view.

A recovery in auto production as shortages of semiconductors and other parts eased was the main factor behind the improved sentiment. It was also helped by better earnings.

Companies raised prices to pass on the costs of more expensive raw materials and labor shortages.

Meanwhile, large non-manufacturers are even more upbeat.

The index tracking their mood is up 3 points to plus 23. That's the fifth straight quarter of improvement. The reading is the highest since June 2019, before the coronavirus pandemic.

An increase in foreign tourists and a business recovery at hotels and restaurants were the major drivers.