Japan factory activity contracts anew; Nov PMI falls to 48.3

SINGAPORE (ICIS)–Japan’s manufacturing activity shrank in November, registering a purchasing managers’ index (PMI) reading of below 50 for the sixth straight month, as output and new orders declined.

The November PMI of the world’s third-largest economy slipped to 48.3 from 48.7 in October, according to a joint survey of manufacturers by Japan’s au Jibun Bank and financial intelligence services provider S&P Global.

The final November reading came in higher than the initial estimate of 48.1.

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

“The downturn [in output] reportedly reflected production adjustments in response to weaker demand and a lack of new product launches,” au Jibun Bank stated on 1 December.

New orders continued to fall amid cooling demand in both domestic and export markets.

“Despite the weaknesses displayed in the components of the headline PMI, manufacturers remained optimistic that muted demand and production conditions would lift over the coming year,” S&P Global Market Intelligence Analyst Usamah Bhatti said.

“The degree of positive sentiment was robust overall, as firms cited hopes of a broad-based boost to domestic and international demand following new product launches, most notably in the semiconductor sector,” Bhatti added.

Thumbnail image: Japan’s national flag flies near a container port in Tokyo. The country’s November 2023 manufacturing activity was in contraction for the sixth straight month. (Source: Eugene Hoshiko/AP/Shutterstock)