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Japan’s Services PMI Slowed in March, as New Orders Dropped


Avril, 04 2018
watermark Economic news

The service sector in Japan grew at a slower manner in the period of one year and five months with cooled economic growth, which means a moderate progress in general.

The Markit/Nikkei Japan Services Purchasing Managers Index (PMI) with a seasonally adjusted basis dropped to 50.9 in March from 51.7 in February.

This has been the lowest reading since October 2016 but the reading is still higher than the 50 mark which separates expansion from contraction for the 18th consecutive month.

Despite the PMI data was negative, even if the demand conditions are still not good, the outlook remains sanguine, according to an economist at IHS Markit, Joe Hayes, who works on the survey.

“Incoming new business has grown for 20 successive survey periods, and firms expect this trend to continue, as indicated by a solid degree of optimism towards future activity.”, he added.

The new business index decline to 51.0 from 51.9 in February because of future business expectations that only declined slightly while the overall future outlook remains strong.

Meanwhile, the reading for employment also increases with a higher number of hired workers.

The composite PMI of both the manufacturing and services sectors slid to 51.3 from 52.2 in February.

Japan’s economy was known to have progressed for eight consecutive quarters, which has been the longest running period since the 12-quarter growth in the period of mid-to-late 1980’s upsurge.

A separate final reading of manufacturing survey reflects a slow loss of momentum in the factory sector, implying slow advancement of the economy in the year as the consumer spending decreases.


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