Japan’s Manufacturing PMI was finalized at 49.8 in June, a downturn from May’s 50.6, according to au Jibun Bank. The reading fell just short of the neutral 50.0 threshold that separates expansion from contraction, indicating a slight decline in the health of the nation’s manufacturing sector.
The report also highlighted that both output and new orders regressed, while supplier performance showed the most significant improvement since March 2016. Input prices increased at the slowest pace observed in the past 28 months.
Usamah Bhatti of S&P Global Market Intelligence noted, “The latest data pointed to a fractional deterioration in the Japanese manufacturing sector at the midpoint of 2023.”
However, the slackening in demand and output conditions had a double-edged effect. On one hand, pressure on supply chains eased in June, with average lead times shortening for the second successive month. Simultaneously, easing pressure on supply chains also alleviated inflationary pressures, driving the Input Prices Index to a 28-month low.