TOKYO- Japan’s factory activity expanded at the slowest pace in four months in June, in a sign momentum in the world’s third-largest economy was levelling out before Tokyo is set to host the Olympic Games next month.
Activity for the private sector as a whole contracted for a second straight month due to the weaker reading for manufacturing and continued shrinking in the services sector, clouding the outlook for second-quarter economic growth in the country.
The au Jibun Bank Flash Japan Manufacturing Purchasing Managers’ Index (PMI) fell to a seasonally adjusted 51.5 in June from a final 53.0 in the previous month, largely due to a sharp decline in output.
Output shrank at the quickest rate since last November, the PMI survey showed, underscoring the pressure Japanese firms were facing from restrictions put in place in response to the health crisis.
“Flash PMI data signaled a quicker deterioration in business activity,” said Usamah Bhatti, economist at IHS Markit, which compiles the survey.
