Japan PMI Manufacturing was finalized at 50.7 in October, slightly down from September’s 50.8. That’s the lowest level in 21 months. S&P Global noted that inflationary pressure remained severer. Business remained optimistic with sentiment at nine-month high.
Laura Denman, Economist at S&P Global Market Intelligence, said:
“The latest survey data signalled that Japan’s manufacturing sector lost further momentum in October. Sluggish markets and weaker demand conditions, on both a domestic and international level, became a recurring trend throughout the report and were seemingly the driving forces behind the slower sector performance. Anecdotal evidence suggested that worsening conditions in China and South Korea were specifically detrimental to Japan’s exports this month.
“Meanwhile, inflationary pressures remained severe in October. Japanese manufacturing firms increased their selling prices more aggressively, as signalled by a near-record rate of output cost inflation. Given the current conditions in some of Japan’s key export markets, and with inflationary pressures displaying limited signs of easing, demand is likely to remain subdued in the coming months.
“Despite this, firms seem unfazed by the challenges that the sector is currently facing remaining optimistic towards their 12-month outlook on growth in October. In fact, the degree of confidence accelerated from September and reached a nine-month high.”
