Japan March final manufacturing PMI cools slightly, overall economy still solid

[TOKYO] Japanese manufacturing activity expanded at a slightly slower pace in March, revised data from a survey showed on Monday, as growth in new orders and output moderated slightly though the economy overall remained in solid shape.

The Final Markit/Nikkei Japan Manufacturing Purchasing Managers Index (PMI) fell to 53.1 in March on a seasonally adjusted basis, slightly below a preliminary 53.2 and below a final 54.1 in February.

The headline reading fell for the second consecutive month, but remained above the 50 threshold that separates contraction from expansion for the 19th executive month.

"Latest survey data presented a second successive decline in the Manufacturing PMI for Japan," said Joe Hayes, economist at IHS Markit, which compiles the survey.

"That said, the overall picture remains upbeat. The reading of 53.1 still indicates a fairly solid pace of improvement in business conditions." The final index for new orders was 53.1, below the preliminary reading of 53.2 and down from 54.7 in the previous month.

The new export orders index was unchanged from the advance estimate at 52.5, but down compared with a final 54.1 in February.

Japan's economy has expanded for eight consecutive quarters, the longest uninterrupted streak since a 12-quarter run of growth during the mid-to-late 1980s boom.

Some economists have cautioned that the pace of growth could moderate this year because consumer spending may ebb slightly, even though strong exports performance of Japan Inc. continues to underpin the world's third-biggest economy.

REUTERS