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Yomiuri Shimbun
3 days ago
- Business
- Yomiuri Shimbun
Japan Factory Declines Slow in May but Tariff Worries Persist, PMI Shows
Reuters A worker walks near a factory at the Keihin industrial zone in Kawasaki, Japan, March 8, 2017. TOKYO, June 2 (Reuters) – Japan's factory activity shrank at the slowest pace in five months in May as the decline in new orders eased, but worries over U.S. tariffs have dampened the recovery from an almost year-long contraction, a private-sector survey showed on Monday. The final au Jibun Bank Japan Manufacturing Purchasing Managers' Index (PMI) rose to 49.4 in May from 48.7 in April, marking the 11th consecutive month of staying below the 50.0-line that indicates contraction. Still, the reading was higher than the flash figure of 49.0 and the highest so far this year. 'Manufacturing conditions in Japan moved closer to stabilization in May, according to latest PMI data, with companies signaling a softer decline in sales and improved jobs growth,' said Annabel Fiddes, Economics Associate Director at S&P Global Market Intelligence, which compiled the survey. Among sub-indexes, new orders fell for the 24th straight month, with manufacturers citing U.S. tariffs and increased client hesitancy as factors behind subdued demand conditions. Factory output also contracted for a ninth consecutive month, at a quicker pace than in April, the survey showed. To mitigate the impact of the U.S. tariffs on cars and other manufacturing sectors, which are the backbone of the Japanese economy, Tokyo has held four rounds of trade talks with Washington and plans a fiscal package to support households and businesses. In a positive sign, input cost inflation eased to a 14-month low in May, while output price inflation slowed to the softest in nearly four years. Employment increased for the sixth month in a row as firms filled vacancies and prepared for anticipated production increases, according to the survey. Business confidence on future output strengthened from April's near five-year low, with firms citing expectations of stronger market demand particularly in the semiconductor industry. However, some expressed concerns over U.S. tariffs, inflation and Japan's declining population as potential headwinds to growth, the survey showed.
Straits Times
3 days ago
- Business
- Straits Times
Asia's factory activity shrinks in May as US tariffs bite
Asia's factory activity shrank in May as soft demand in China and the impact of US tariffs took a heavy toll on companies, private surveys showed. PHOTO: EPA-EFE Asia's factory activity shrinks in May as US tariffs bite - Asia's factory activity shrank in May as soft demand in China and the impact of US tariffs took a heavy toll on companies, private surveys showed on June 2, highlighting the darkening outlook for the once fast-growing region. Trade-reliant Japan and South Korea continued to see manufacturing activity contract in May as US President Donald Trump's automobile tariffs cloud the outlook for exports. Adding to the gloom, an official survey on May 31 showed China's manufacturing activity shrank in May for a second month in a sign of weakness in the world's second-largest economy. With many Asian economies making little progress in trade negotiations with the United States, uncertainty will likely keep companies from boosting production or spending, analysts said. 'It's hard to expect a pickup in Asia's manufacturing activity any time soon with countries in the region slapped with quite high 'reciprocal' tariffs,' said Mr Toru Nishihama, chief emerging market economist at Dai-ichi Life Research Institute. 'With domestic demand weak, China is flooding Asia with cheap exports, which is also putting deflationary pressure on the region's economies,' he said. Japan's final au Jibun Bank Manufacturing Purchasing Managers' Index (PMI) stood at 49.4 in May, up from April but staying below the 50 line that indicates contraction for the 11th successive month, a private survey showed on June 2. The PMI for South Korea, Asia's fourth-largest economy, stood at 47.7 in May, also staying below the 50 mark for a fourth month due to frail demand and the hit from US tariffs, a survey by S&P Global showed. Both Japan and South Korea saw their economies contract in the first quarter, as Mr Trump's tariffs and uncertainty over US trade policy weighed on exports and corporate activity. There is little sign conditions will improve. On May 30, Mr Trump said China had violated a two-way deal to scale back tariffs, whereas China contended it had maintained communication on trade with the US. Mr Trump also announced a doubling of worldwide steel and aluminium tariffs to 50 per cent, once again rattling international trade. Japan and the US on May 30 agreed to hold another round of trade talks ahead of the Group of Seven summit in June, but Japan's top tariff negotiator said no deal would be reached without concessions on all US tariffs, including on automobiles. Vietnam, Indonesia and Taiwan also saw factory activity contract in May, private surveys showed. REUTERS Join ST's Telegram channel and get the latest breaking news delivered to you.
Hindustan Times
4 days ago
- Business
- Hindustan Times
Asia's factory activity shrinks in May as US tariffs bite
* Japan's PMI shrinks for 11th month in May * South Korea's factory activity also contracts in May * US trade uncertainty to keep firms from investing, analysts say TOKYO, - Asia's factory activity shrank in May as soft demand in China and the impact of U.S. tariffs took a heavy toll on companies, private surveys showed on Monday, highlighting the darkening outlook for the once fast-growing region. Trade-reliant Japan and South Korea continued to see manufacturing activity contract in May as U.S. President Donald Trump's automobile tariffs cloud the outlook for exports. Adding to the gloom, an official survey on Saturday showed China's manufacturing activity shrank in May for a second month in a sign of weakness in the world's second-largest economy. With many Asian economies making little progress in trade negotiations with the U.S., uncertainty will likely keep companies from boosting production or spending, analysts said. "It's hard to expect a pick-up in Asia's manufacturing activity any time soon with countries in the region slapped with quite high 'reciprocal' tariffs," said Toru Nishihama, chief emerging market economist at Dai-ichi Life Research Institute. "With domestic demand weak, China is flooding Asia with cheap exports, which is also putting deflationary pressure on the region's economies," he said. Japan's final au Jibun Bank Manufacturing Purchasing Managers' Index stood at 49.4 in May, up from April but staying below the 50.0 line that indicates contraction for the 11th successive month, a private survey showed on Monday. The PMI for South Korea, Asia's fourth-largest economy, stood at 47.7 in May, also staying below the 50 mark for a fourth month due to frail demand and the hit from U.S. tariffs, a survey by S&P Global showed. Both Japan and South Korea saw their economies contract in the first quarter, as Trump's tariffs and uncertainty over U.S. trade policy weighed on exports and corporate activity. There is little sign conditions will improve. On Friday, Trump said China had violated a two-way deal to scale back tariffs, whereas China contended it had maintained communication on trade with the United States. Trump also announced a doubling of worldwide steel and aluminium tariffs to 50%, once again rattling international trade. Japan and the U.S. on Friday agreed to hold another round of trade talks ahead of the G7 summit in June, but Japan's top tariff negotiator said no deal would be reached without concessions on all U.S. tariffs, including on automobiles. Vietnam, Indonesia and Taiwan also saw factory activity contract in May, private surveys showed.
Yahoo
01-04-2025
- Business
- Yahoo
Japan's factory activity declines pick up, PMI shows
TOKYO (Reuters) - Japan's factory activity declines accelerated in March as demand weakened and the escalating U.S. trade war clouded the manufacturing outlook, a private-sector survey showed on Tuesday. The final au Jibun Bank Japan Manufacturing Purchasing Managers' Index (PMI) fell to 48.4 in March from 49.0 in February, hitting the lowest in 12 months. Although the final reading was slightly higher than the flash figure of 48.3, it also marked the ninth straight month below the 50.0 threshold that separates growth from contraction. "Indices for output and new orders fell further into contraction territory, as companies noted weaker demand from both domestic and international clients," said Annabel Fiddes, Economics Associate Director at S&P Global Market Intelligence, which compiled the survey. Output declined for the seventh straight month and at the quickest pace in a year, while new orders contracted for a 22nd consecutive month. New export business also fell slightly, with manufacturers citing muted demand from key markets such as China and the United States, according to the survey. Companies' outlook for future demand improved from February, when it hit the lowest since 2020, but the recovery was slow, due in part to "greater uncertainty over the global economic outlook and trade environment," Fiddes said. U.S. President Donald Trump last week unveiled a 25% tariff on imported cars to take effect on April 3, in what could be a major blow to Japan's manufacturing sector and the broader economy. Meanwhile, employment emerged as a bright spot, with firms adding workers at the fastest pace in three months. Some companies said that they added to payrolls to fill in vacancies or in anticipation for greater demand ahead, according to the survey. Cost pressures remained high, with companies reporting sharp increases in expenses for labour, materials, energy and transport, exacerbated by an unfavourable exchange rate. "The latest survey showed historically strong increases in both input costs and selling prices in March, to suggest inflationary pressure across the sector remains acute," Fiddes added. Sign in to access your portfolio
