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Tokyo — Japan’s services sector activity expanded at the fastest pace in more than eight years in June, as mitigation of coronavirus suppression raised the sentiment of companies such as the tourism industry.
The recovery of activity is welcome news for governments betting on domestic demand to help ensure that the world’s third-largest economy is on a recovery track and overcome production pressures on the country’s manufacturing industry.
au Jibun Bank Japan Services Industry’s Final Purchasing Managers Index (PMI) rose to seasonally adjusted 54.0, expanding at the fastest pace since October 2013.
This remained below the June 54.2 flash reading released last month, but was stronger than the last 52.6 growth in May.
Usamabati, an economist at S & P Global Market Intelligence, who summarized the survey, said:
However, rising demand for services and rising fuel and raw material prices have led to record-breaking increases in corporate average input prices. Survey data dates back to September 2007.
“This has allowed businesses to raise service prices the fastest since October 2019,” said Bhatti.
Studies show that the resurgence of COVID-19 cases abroad, especially in China, Japan’s major trading partner, has hampered overseas sales.
In addition, although the job creation rate was weaker than in May, the service sector showed an increase in employment for the fifth consecutive month.
Estimated composite PMI using both manufacturing and service industries rose from the previous month’s final of 52.3 to 53.0, growing at the fastest rate in seven months.
By Daniel Leussink
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