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Investing.com-- Japanese manufacturing activity shrank for the tenth consecutive month in April as new orders declined at the steepest rate in over a year amid U.S. tariff concerns, preliminary purchasing managers index (PMI) data showed on Wednesday.
The au Jibun Bank manufacturing PMI came in at 48.5 in April, below the forecast of 48.7. It was slightly higher compared to March’s contraction of 48.4.
A PMI print below 50 entails contraction, with Japan’s manufacturing PMI shrinking for the tenth consecutive month in April.
"Factories saw new orders decline at the steepest rate in over a year amid a stronger deterioration in foreign demand, as well as reports of subdued client spending and concerns over tariffs," said Annabel Fiddes, Economics Associate Director at S&P Global Market Intelligence.
Business confidence fell to its lowest point since June 2020, driven by widespread worries about U.S. trade tariffs and uncertainty surrounding the global economic outlook.
Meanwhile, Japanese services activity rebounded, with the au Jibun Bank services PMI rising to 52.2 in April, from a neutral reading of 50.0 in March.
The renewed uptick in services activity was fueled by a continued improvement in customer demand, with overall sales growing at the fastest pace in three months, the survey stated.
“Uncertainty over the global economic outlook and trade environment, staff shortages and an ageing population dampened confidence across both the manufacturing and service sectors. Notably, overall optimism regarding the one-year outlook for output fell to the lowest level since the initial wave of the COVID-19 pandemic in August 2020,” S&P’s Fiddes added.
The rise in services activity saw the overall composite PMI expanding to 51.1 in April from 48.9 in March, after its first decline in five months in the previous month.