The manufacturing sector in Japan slid to contraction in April, the latest survey from Markit Economics revealed on Thursday, with a PMI score of 49.7.
That missed forecasts for 50.8 and it’s down from 50.3 in March. It also slips beneath the boom-or-bust line of 50 that separates expansion from contraction.
“Latest data signaled worsening operating conditions in the Japanese manufacturing sector. New orders continued to fall, while manufacturing production decreased for the first time since July 2014. The rate of decline was only fractional, however. In contrast, employment returned to growth in April, albeit at a marginal pace,” said Amy Brownbill, economist at Markit.
Among the individual components of the survey, the index for manufacturing output fell to 49.7 from 52.0 in March, marking the first contraction since last July.
Also, new orders, backlogs of work, stocks of purchases and quantity of purchases all continued to contract.
The indexes for employment, output prices and stocks of finished goods turned to expansion after contracting in the previous month.
New export orders and input prices continued to expand, while supplier delivery times lengthened at a faster rate.
“Meanwhile, reports of a favorable yen/dollar rate continued to help improve price competitiveness, as companies noted a rise in new export orders for the tenth consecutive month,” Brownbill said.
The material has been provided by InstaForex Company – www.instaforex.com