Japan Manufacturing PMI Continues To Fall In May

Japan's manufacturing output declined for the second consecutive month in May, though at a slower rate, a report by Markit Economics showed Monday.

The manufacturing purchasing manager's index came in at 49.9 in May, following the 49.4 figure in April.

According to the report, though the headline index is below the 50-mark that separates expansion and contraction, a broad stabilisation in business conditions in the manufacturing sector was seen in May.

The decline in manufacturing output was attributed to a decline in demand due to an increase in sales tax, the report said.

New orders continued to fall in May, though at a slower rate, moving closer to the no-change mark and new export orders declined marginally.

Outstanding work saw the fastest rate of fall since July 2013, due mostly to the drop in business after the rise in sales tax.

Despite the decline in manufacturing output, employment grew for the tenth consecutive month as companies hired extra staff anticipating workload growth. However, rate of job creation eased to the slowest rate since November 2013.

While input prices continued to rise, Japanese manufacturing companies cut down selling prices on account of competitive pressures in May.

The seasonally adjusted supplier's delivery times index was at its shortest level in May since December 2012.

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