Japan Dec factory activity posts sharpest fall in more than 2 years -PMI

TOKYO (Reuters) – Japanese factory activity fell at its steepest pace in 26 months in December, a business survey shown Wednesday showed.

The au Jibun Bank Japan Manufacturing Purchasing Managers Index fell slightly from 49.0 in November to a seasonally adjusted 48.9 in December.

While slightly higher than the flash number of 48.8, the reading was the weakest since October 2020, two months below the 50 line that separates contraction and expansion.

“The current weak demand environment, both internationally and domestically, is the main reason for the recession,” said Laura Denman, an economist at S&P Global Market Intelligence who compiled the survey.

Output and new orders continued to contract for the sixth month in December, but at a slower pace than last month, according to sub-indices of the survey.

The survey showed that input price inflation had fallen to a 15-month low and cost pressures were easing, but the rest of the results are a reflection of the outlook for Japanese equities in early 2023. is dark.

Manufacturers had expected a further deterioration in the business environment as the future production sub-index reached its lowest level since May when China’s COVID-19 lockdown disrupted the supply chains of Japanese companies.

“Future indicators are making the future of Japan’s manufacturing industry increasingly bleak,” Denman said.

The survey confirms weak factory output data released last week that showed a three-month contraction in November.

Analysts expect Japanese production to remain subdued in the coming months due to lower overseas demand as the coronavirus situation in China poses further downside risks.

Reported by Kantaro Komiya.Edited by Sam Holmes

Our standards: Thomson Reuters Trust Principles.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *