Japan flash Feb manufacturing PMI falls to 47.2 on steep new orders decline

SINGAPORE (ICIS)–Japan’s manufacturing purchasing managers’ index (PMI) fell to 47.2 in February from 48.0 in January after a strong decline in new orders, flash estimates from au Jibun Bank showed on Thursday.

A PMI reading above 50 indicates expansion while a lower number denotes contraction.

The drop in new orders led to a production shrinking at the fastest rate in a year and signalled a ninth consecutive deterioration in the PMI that was the most marked since August 2020, it said in a statement.

Purchasing activity at Japanese manufacturers fell sharply in February, while lower capacity pressures led to employment levels falling at the quickest pace since January 2021.

“Price pressures faced by Japanese manufacturers softened during February, as the rate of input inflation eased to a seven-month low,” au Jibun Bank said.

Japan’s economy was in technical recession after contracting for a second consecutive quarter from the 3.3% fall recorded in July-September 2023, amid sustained weakness in private consumption and business spending.