TOKYO (Reuters) – Growth in Japanese manufacturing activity slowed slightly in January from December but remained solid as new export orders accelerated, a survey showed on Monday.
The Markit/Nikkei Final Japan Manufacturing Purchasing Managers Index (PMI) dipped to 52.3 in January on a seasonally adjusted basis, slightly less than a preliminary reading of 52.4 and a final 52.6 in December.
The index remained well above the 50 threshold that separates contraction from expansion for the ninth consecutive month.
The sub-index for new export orders rose to 53.2, compared with a preliminary 52.6 and December’s final 52.2.
However, the index for new orders – which cover total orders from both at home and abroad – fell to 52.8 from 54.2 in the previous month, suggesting domestic demand may be softening. The flash reading for January was 52.7.
Input prices likely fell for the first time in over three years due to declines in raw material costs, especially oil, and manufacturers cut selling prices in response, likely adding to headaches for the government and Bank of Japan as they battle to pull the country decisively out of deflation.
The Bank of Japan stunned investors on Friday by unexpectedly lowering a benchmark interest rate into negative territory as volatile markets and slowing global growth threaten its efforts to revive the economy.
(Reporting by Stanley White; Editing by Kim Coghill)
