Highlights 2-Japan business sentiment hits 4-yr low - tankan

TOKYO, April 1 (Reuters) - Japanese business sentiment fell
to a four-year low in the first quarter, a Bank of Japan survey
showed, providing further evidence of a weakening economic
outlook and reinforcing views among some in the market that the
central bank may cut interest rates later in the year.

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Following is a summary of details of the survey from a
briefing by a central bank official:

- The headline index for big manufacturers' sentiment was
plus 11, down for the second straight quarter. It compared with
plus 19 in December, below the market's median forecast of plus
13 and making it the biggest drop in three years.

- It was the weakest showing since the final quarter of 2003,
when it was plus 7.

- The index for June was seen at plus 7, suggesting firms
expect conditions to worsen over the next three months.

- Big firms expect their capital spending to fall 1.6 percent
in the financial year that started on Tuesday, compared with the
market's median forecast for a flat reading from the previous
year.

- It was the first negative capex reading for the March
tankan since 2004 and the lowest reading in six years.

- Small firms expect their capex to tumble 24.2 percent in
the fiscal 2008/09, the weakest reading for the start of the new
financial year since 1999.

- The headline sentiment index for big non-manufacturers was
plus 12, slightly above the market's median forecast for plus 11
but down for the third quarter in a row. It was the weakest
reading since March 2005, when it was at plus 11.

- The index for June was seen at plus 13.

- The sentiment index for small manufacturers fell to minus 6
from plus 2 in the previous survey, the lowest reading since the
final quarter of 2003 when it was minus 10.

- The sentiment index stood at minus 15 for small
nonmanufacturers, down three points and the lowest reading since
September 2004 when it was minus 17.

- The sentiment index for June was seen at minus 9 for small
manufacturers and minus 21 for small nonmanufacturers.

- Big manufacturers see the dollar averaging 109.21 yen in
the new business year that started on Tuesday, the lowest level
since the start of fiscal 2005/06, when they saw the dollar
averaging 104.52 yen.

- The index for input prices -- the percentage of firms
saying they expect input prices to rise minus those saying they
expect them to fall -- stood at plus 50 for big manufacturers, up
from plus 45 in December and the highest since August 1980, when
it was plus 53.

- The input prices index for big nonmanufacturers was up five
points to plus 34, the highest since November 1990 when it was
plus 40.

- The index for output prices stayed at plus 3 for big
manufacturers and at plus 5 for big nonmanufacturers.

- The input prices index for small manufacturers was up six
points to plus 63 -- the highest since May 1980 when it was plus
77, while the index for small nonmanufacturers stood at plus 45
which was the highest since November 1990 when it was plus 46.

- The output prices index was up three points to plus 2 for
small manufacturers -- the highest since May 1991 when it was
plus 8, while the index for small nonmanufacturers was unchanged
at minus 10.

- The employment index -- the percentage of firms saying they
have excess workers minus those saying they don't have sufficient
workforce -- stood at minus 9, up slightly from minus 10 in
December, with job conditions easing at both big and small
nonmanufacturers for the first time in three quarters.
(Reporting by Tetsushi Kajimoto)