Japan September factory growth slows to 6-month low, PMI shows
EWJ•Japan’s manufacturing PMI fell to 54.1 in September from 54.9 in August, its lowest reading in six months, but remained in expansion for a ninth consecutive month.
1. Growth slows in September
Japan’s manufacturing sector expanded at its weakest pace in six months as output and new order growth slowed. The S&P Global Japan Manufacturing PMI eased to 54.1 from 54.9 in August, matching its flash reading; readings above 50 indicate expansion.
2. Export demand remains firm
New export orders rose for a ninth straight month, with growth at its second-sharpest pace since January 2018, supported by stronger demand across Asian economies and improved sales to the US. Employment increased for a 22nd consecutive month, while backlog growth fell to a six-month low.
3. Costs and outlook
Input cost inflation eased to a six-month low, but firms continued to raise selling prices at one of the sharpest rates since late 2022. Manufacturers remained optimistic about output over the next 12 months, citing demand related to semiconductors and AI technology, while flagging supply disruption, component shortages and rising costs as risks.
