Japan’s April factory activity expands at slower rate

Tokyo, May 2 (BNA): Japan’s manufacturing activity grew at a slower pace than the previous month in April, as supply chain disruptions and strict Chinese coronavirus lockdowns hit overseas demand.



Activity in the sector has faltered due to resilience in production, aggregate orders and optimism about the year ahead, even as producers grow increasingly concerned about persistent price pressures, the Ukraine war, logistical bottlenecks and the global economic outlook, Reuters reported.



Japan’s au Jibun Bank Manufacturing Purchasing Managers’ Index (PMI) fell to a seasonally adjusted 53.5 in April from the final 54.1 the previous month.



This was very much in line with Flash’s 53.4 readout. The 50 mark separates contraction from expansion.



“The latest PMI data pointed to a sustained expansion in the Japanese manufacturing sector at the start of the second quarter,” said Osama Bhatti, an economist at Standard & Poor’s Global, who compiles the survey.



“The growth rate slowed from March as companies noticed weak growth in new orders and a broadly unchanged expansion in production levels.”



The PMI survey showed that input prices jumped at the strongest pace since August 2008, prompting manufacturers to raise selling prices at the fastest rate in the survey’s history.



This has reduced business optimism about conditions for the next 12 months to its lowest level since July 2020.



“Although Japanese commodity producers remain optimistic, they are increasingly concerned about the continuing impact of price and supply pressures, as well as the impact of the war and extended shutdowns in China,” Bhatti said.

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