TOKYO: Growth in Japan’s manufacturing sector slowed in February as output and new orders increased at a slower rate, according to preliminary survey results. The Nikkei-Markit flash manufacturing purchasing manager’s index edged lower to 54 in February, down from 54.8 in January and closer to the 50-point line separating growth from contraction.
Output and new orders both increased, but at a slower pace than the previous month, while employment growth accelerated to an 11-year high. “On the one hand, output and new business inflows increased to weaker extents, while recent yen appreciation has coincided with slower new export order growth,” Joe Hayes, economist at IHS Markit said. “Furthermore, a number of panellists indicated that the stronger currency had prompted them to lower prices to overseas customers. Indeed, further yen strengthening will create unwanted drag on inflationary pressures”.
