Japan's services sector growth slows in May on weaker demand
New business growth in the service sector eased to its slowest pace since November. — Reuters
TOKYO: Growth in Japan's service-sector activity slowed in May on weaker demand, offering little to mitigate falling factory activity and resulting in a near-zero growth for business overall, a private-sector survey shows.
The final au Jibun Bank Japan Services purchasing managers' index (PMI) fell to 51 in May from 52.4 in April. An index reading above 50 indicates growth and a reading below indicates contraction.
New business growth in the service sector eased to its slowest pace since November, while employment growth in services was the weakest rate since December 2023, the survey showed.
Service-sector managers' confidence in their future outlook improved to a three-month high in May from April's four-year low, but the overall level stayed weaker than the post-pandemic average, according to the survey.
'Concerns over the outlook often stem from uncertainty over future global demand, as well as labour shortages and rising costs,' said Annabel Fiddes, economics associate director at S&P Global Market Intelligence, which compiled the survey.
'The latter was highlighted by a further steep increase in input prices, to suggest that official inflation data will remain strong.' — Reuters
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