Japan’s factory activity hits near 4-year high in February: PMI

[TOKYO] Japan’s manufacturing activity accelerated in February to its fastest pace in almost four years, as robust demand led to sharp increases in output, new orders and employment across the board, a private-sector survey showed on Monday.

The S&P Global Japan Manufacturing Purchasing Managers’ Index (PMI) rose to 53.0 in February, up from January’s 51.5, marking the biggest expansion since May 2022 and inching up from the flash reading of 52.8. A reading above 50.0 indicates expansion, while below that level signals contraction.

Manufacturing output, new orders and employment grew at their quickest rates since January 2022, driven by improved global demand conditions and new product launches, according to the survey.

New export business expanded at the fastest rate since June 2021, with stronger demand noted across Europe and Asia. This marked quite a contrast from just two months ago, when export business was on a contraction streak for nearly four years.

Annabel Fiddes, economics associate director at S&P Global Market Intelligence, said: “Firms were also much more upbeat about the year ahead, with confidence rising to the highest since mid-2024. There were expectations that global demand conditions will continue to revive and push up sales in the months ahead, particularly in key sectors such as technology and automotives.”

Inflationary pressures remained elevated but slightly eased from January, as both input and output prices rose at slower rates. REUTERS