According to a private-sector survey released on Thursday, Japan’s factory activity continued to decline for the fourth consecutive month in October, driven by subdued demand and weak orders.
In October, the au Jibun Bank flash Japan manufacturing purchasing managers’ index (PMI) dropped to 49.0 from September’s 49.7, staying below the 50.0 threshold that divides growth from contraction.
Usamah Bhatti, an economist at S&P Global Market Intelligence, noted that both manufacturing and services experienced decreases in new orders, with international orders falling at their fastest rate since February 2023.
The subindex tracking new orders in manufacturing continued to shrink in October, remaining under the 50.0 mark since June 2023, while manufacturing output declined for the second month in a row.
Japan experienced a decline in exports for the first time in ten months this September, driven by tepid demand from China and a slowdown in U.S. economic growth, according to recent government data.
The country’s service sector reported that both domestic and international economic sluggishness led clients to refrain from placing new orders.
Meanwhile, the International Monetary Fund (IMF) forecasts Japan’s economic growth to decelerate to 0.3% this year, down from 1.7% in 2023.
