Japanese manufacturers saw solid improvement
This suggested the slowdown recorded in July marked only a temporary lull, although a slight fall in new export orders in August cast a shadow on an otherwise strong performance of Japan's manufacturing Industry.
The headline seasonally adjusted Markit/JMMA Purchasing Managers' Index (PMI) – a composite indicator designed to provide a singlefigure snapshot of the performance of the manufacturing economy – rose from 50.7 in July to 52.2 in August, the second highest recorded in the current six-month run of growth.
Manufacturing output rose at the fastest rate recorded in 30 months in August, which also marked the sixth successive month of growth. Anecdotal evidence indicated this was largely a result of an expansion of domestic demand and the latest data supported this, with new orders increasing at a solid pace for the sixth consecutive month.
In turn, the rise in new orders was cited by some manufacturers as a primary factor behind an increase in backlogs, which rose for the first time in 27 months.
Sector level data indicated the rise in new business was largely driven by investment goods manufacturers. Conversely intermediate goods producers recorded not only a more modest rise in new orders, but a marked decline in output. ■