TOKYO- Japan’s service-sector activity extended gains in August, a private sector survey showed on Wednesday, thanks to an uptick in overseas sales despite a darkening global outlook.
The final au Jibun Bank Service purchasing managers’ index (PMI) was unchanged at 53.7 last month, staying above the 50.0 line that separates expansion from contraction for a second consecutive month.
While the headline figure was in line with July’s reading, service companies’ new business growth slowed from the previous month.
But export sales rebounded from a contraction in July to the largest rise in three months, supporting overall service-sector business.
That marks a contrast to Japan’s manufacturing PMI for August released on Monday, which indicated the weakest exports in five months on weak demand in China, South Korea and other key markets.
Recent government data showed Japan’s export growth missed expectations in July, suggesting growing risks of further deceleration due to a stronger yen and softer conditions.
Weak global demand poses a challenge for sustainable economic growth and the Bank of Japan’s policy tightening, which has signaled more rate hikes if the economy and inflation keep up with its forecasts.
