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JAPAN MANUFATURING CONTINUES TO CONTRACT

24-06-2016
by 
in 
Photo Credit: REUTERS/YUYA SHINO

Earthquakes, the rising Yen, and a slowing national economic growth have held back Japan’s manufacturing industry for the fourth month in a row. 

The Markit/Nikkei JapaFlash Manufacturing Purchasing Managers Index (PMI) stretched up from 47.7 to 47.8 in June, remaining below the growth-indicating threshold of 50.

The preliminary index for new orders grew from 44.7 to 45.8, but is also under the 50-threshold, and is in contraction.

Markit said that the latest survey data “pointed to a further deterioration in manufacturing conditions in Japan.”

As both production and new orders are on the decline, fed by a marked decrease in international demand, there is concern that the rising value of the Yen (15% this year to date) will further damage exports.

The future of Japan’s economic growth is uncertain. While their economy remains strong as a whole, rapid expansion appears to be giving way to slow but stable growth.

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