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The manufacturing sector in Japan continued to expand in May, albeit at a slower pace, the latest survey from Jibun Bank showed on Tuesday with a manufacturing PMI score of 53.2.
That's down from 53.5 in April, although it remains above the boom-or-bust line of 50 that separates expansion from contraction.
Both output and new order growth slowed to a marginal pace that was the weakest for three months. Manufacturers commonly noted heightened supply chain pressures, as delivery times lengthened to the greatest extent since the earthquake and tsunami in April 2011, exacerbated by material shortages and renewed lockdown restrictions in China. This contributed to the third-strongest increase in input prices in the survey history.
The survey also showed that the services PMI improved to 51.7 in May from 50.7 in April, while the composite PMI rose to 51.4 from 51.1.
The easing of pandemic-related restrictions and the diminishing impact of the virus were cited as key reasons for the uplift, notably in the tourism sector. Concurrently, the level of new business received returned to expansion territory, and at the quickest rate since last December. That said, firms continued to face sharp rises in input prices, with the latest increase the steepest in the survey history.
