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Investing.com-- Japan’s manufacturing activity fell back into contraction territory in July, while the services sector showed modest improvement from the previous month, private purchasing managers index (PMI) data showed on Thursday.
The au Jibun manufacturing PMI rose 48.8 in the first three weeks of July, less than expectations of 50.2 and fell from the 50.1 seen in June.
A reading below 50 indicates contraction. The manufacturing PMI has now contracted in 12 of the past 13 months, with June standing out as the only month of expansion
"Manufacturers recorded a fresh fall in output and a sustained drop in new orders amid ongoing uncertainty over US tariffs and a wait-and-see approach among customers," Au Jibun analysts said.
Japan’s services sector continued to grow, with the au Jibun services PMI up at 53.5 in July from 51.7 in the prior month.
Overall business confidence regarding the year ahead weakened during July, hitting the second-lowest level since August 2020, the survey stated.
"Lower levels of optimism were seen across both the manufacturing and service sectors, with companies often expressing concerns over US trade tariffs and the potential impact on demand," it added.
The mixed PMIs saw the au Jibun flash composite output index– a gauge of overall business activity– steady at 51.5 in July.