Japan: PMI points to firm manufacturing activity – Nomura

Analysts at Nomura point out that the Japanese manufacturing PMI for October came in at 53.1, up 0.6pt from the finalized September reading, indicating acceleration in manufacturing activity.

Key Quotes

“Among the five component indices, four made a positive contribution to the headline PMI: the output index rose 1.2pt to 53.0, the employment index rose 1.6pt to 53.4, the new orders index rose 0.2pt to 52.7, and the supplier delivery times index fell 0.3pt to 44.4 (a fall in this index pushes up the headline index). Meanwhile, the stock of items purchased index fell 0.7pt to 50.5.”

“Meanwhile, the new export orders index (which is not included in the calculation of the manufacturing PMI) rose 1.9pt m-m to 51.7, above 50 (the dividing line that separates an overall rise in orders from an overall decline in orders) and pointing to an increase in orders.”

“We expect the global economy to gradually decelerate while evading any sharp slowdown, and we expect Japanese exports and the Japanese economy, given its susceptibility to external demand, to follow a similar path.”