Japan PMI Manufacturing dropped from 52.7 to 52.2 in July, below expectation of 53.1. PMI Services dropped from 54.0 to 51.2. PMI Composite output dropped from 53.0 to 50.6.
Usamah Bhatti, Economist at S&P Global Market Intelligence, said: “Flash PMI data indicated that activity at Japanese private sector businesses rose at a softer rate during July. The expansion in output was the softest recorded since March and only marginal as companies noted that shortages of raw materials and rising energy and wage costs had increasingly dampened output and new order inflows. This was notably evident at manufacturers, who recorded a reduction in production levels for the first time in five months. Service providers meanwhile reported the slowest rise in activity since April”.
Fed Rosengren: CARES Act a good start but we have to do more
Boston Fed President Eric Rosengren said yesterday that Fed has “acted quickly to address spillovers from the economic disruption” caused by coronavirus pandemic. But “we are probably going to have to do more than what was jut in the CARES Act, but I think it was a very good start in trying to mitigate some of the costs”. He referred to the recently passed USD 2T Coronavirus Aid, Relief and Economic Security (CARES) Act.
Rosengren also added “we’re witnessing the pandemic’s stark effects on public health. Meanwhile, the necessary response – social distancing – has stilled our strong economy, disrupting countless lives and livelihoods.” Social distancing practices are also “distorting the credit and liquidity flows that underpin our economy, threatening the greater pain of a full‐blown financial crisis.”