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The au Jibun Bank Japan Services PMI rose to 51.5 in December from 50.8 in November, marking the 16th consecutive month of increasing business activity. The expansion, while modest, signifies resilience in the face of challenges and represents the second-strongest recorded growth in 2023.
However, the final number was revised lower in December 2023 from the preliminary figure of 52.0, indicating a slight adjustment in the growth trajectory.
Interestingly, December data highlighted a stronger improvement in business activity, with firms reporting increased customer numbers across the Japanese services sector for the first time in four months. This uptick in customer engagement reflects a potential shift in consumer behavior and bodes well for the service industry as a whole.
New orders grew the most since September, fueled by robust domestic demand. While foreign demand experienced a marginal decline for the third consecutive month, the overall increase in new orders suggests a positive sentiment in the domestic market.
The au Jibun Bank Japan Composite PMI was revised downward to 50.0 in December 2023 from a flash figure of 50.4. Nonetheless, the latest result surpassed November’s one-year low of 49.6, with accelerated service sector growth mitigating a further reduction in manufacturing production.
“Japanese service providers cited higher customer numbers as one of the key reasons for the increase, indicating a favorable end to the year for firms. The augmented customer engagement also instilled confidence, driving a brighter outlook for the 12-month horizon, buoyed by expectations of economic recovery and long-term business expansions,” remarked Usamah Bhatti, Economist at S&P Global Market Intelligence.
ETFs: (JEQ), (EWJ), (DXJ), (FXY).
Currency: (USD:JPY)
