Japan: Manufacturing PMI ticks up in April
April 21, 2017
The Nikkei Flash Manufacturing Purchasing Managers’ Index (PMI) rose from March’s revised 52.4 (previously reported: 52.6) to 52.8 in April. As a result, the index remains comfortably above the 50-threshold that separates expansion from contraction in the manufacturing sector.
April’s result reflected that output expanded at a faster pace as well as employment. Although growth in new orders remained robust, it softened in the same month. Higher commodity prices are adding pressure on overall prices, with input costs and output charges rising at faster rates. Paul Smith, Senior Economist at IHS Markit highlights that, “April’s PMI data signalled continued healthy growth of Japan’s manufacturing sector, and the latest results were again consistent with production rising at a quarterly rate of around 2%. Driven by firmer external demand, the sector was underpinned by a stronger export performance in April, with new export orders rising at a rate amongst the best seen in the past three years. Companies are also adding to their workforces at a rate that matched January’s 34-month peak.”