TOKYO- Japan’s factory activity shrank for the eight consecutive month in January amid weak demand, but the service sector saw strong gains as new business picked up, a private business survey showed on Wednesday.
The au Jibun Bank flash Japan manufacturing purchasing managers’ index (PMI) was little changed at 48.0 in January from a final 47.9 in December. The headline index has remained below the 50.0 threshold, which separates contraction from expansion, since June.
Both output and new orders, the two key subindexes contributing to the headline figure, remained in contractionary territory but their pace improved slightly from the prior month.
“Backlogs of work broadly stabilized in January, providing an early sign that output was starting to be supported by improved demand rather than the fulfilling of prior orders,” said Usamah Bhatti, an economist at S&P Global Market Intelligence.
While input price inflation persisted in January, its level dipped from December when it hit a three-month high. Output charges went up but at the slowest rate since June 2021.
