TOKYO, Nov 2 (Reuters) – Japan’s manufacturing sector expanded at its slowest pace in seven months in October as output and new orders lost momentum while cost pressures picked up, a business survey showed on Monday. • The S&P Global Japan Manufacturing Purchasing Managers’ Index (PMI) eased to 53.3 in October from 54.1 in September, […]
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Japan’s October factory growth slows as costs pick up, PMI shows
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TOKYO, Nov 2 (Reuters) – Japan’s manufacturing sector expanded at its slowest pace in seven months in October as output and new orders lost momentum while cost pressures picked up, a business survey showed on Monday.
• The S&P Global Japan Manufacturing Purchasing Managers’ Index (PMI) eased to 53.3 in October from 54.1 in September, a survey by S&P Global showed. The 50-mark separates growth from contraction.
• Output rose for a 10th straight month, supported by greater order volumes and stronger demand for semiconductors, although the pace was the softest since March.
• New orders also increased for a 10th consecutive month, as firms cited more favourable market conditions and AI-related demand strength, but the pace of increase was the softest in seven months.
• “The Japanese manufacturing sector has been unable to sustain the rates of growth in output and new orders we saw earlier in the year, but we are still looking at a decent pace of expansion by historical standards at the start of the fourth quarter,” said Phil Smith, Economics Associate Director at S&P Global Market Intelligence.
• Overseas demand remained supportive, but export order growth was the weakest since March. Survey respondents cited stronger demand from Asian markets, including China, North America, Africa and the Middle East.
• Employment growth held steady and stayed close to the fastest seen in the past eight-and-a-half years. The backlog of work accelerated, with some firms also reporting input delivery delays.
• Input price inflation accelerated in October, while output charge inflation eased to a six-month low. Stocks of purchases increased at the fastest rate in almost four years as firms sought to guard against further price rises.
• Manufacturers’ optimism about the year ahead edged up to an eight-month high, with firms citing new product launches, the AI boom and new client introductions as reasons for confidence.
(Reporting by Kaori Kaneko; Editing by Sam Holmes)