Japan’s factory activity rose at the slowest rate in eight months in Sept. as output and orders contracted, like that of the services sector, continued with its downturn.
- The au Jibun Bank Flash Japan Manufacturing Purchasing Manager’s Index (PMI) dropped to a seasonally adjusted 51.2 in Sept. from a final 52.7 in the previous month, marking the slowest growth since January.
- Factory activity has encountered headwinds from disruptions of parts supplies due to the rapid spread of the COVID-19 delta variant and global semiconductor shortage. The Sept. data revealed Japanese manufacturers’ output contracted at the fastest pace in a year, while overall new orders contracted at the most rapid pace in 10 months.
- The au Jibun Bank Flash Services PMI index remained in contraction, even though it rose to a seasonally adjusted 47.4 from the previous month’s final of 42.9.
- The au Jibun Bank Flash Japan Composite PMI was in contraction for a fifth consecutive month, though it gained to 47.7 from August’s final of 45.5.
Usamah Bhatti, the economist at IHS Markit, stated that flash PMI data revealed that activity at Japanese private sector businesses was scaled down further in Sept. Input prices across the private sector rose, with businesses attributing the rise to higher costs of raw materials and supply shortages.
Nikkei 225 +2.06%, JPY USD down -0.09%Source: IHS Markit