Japan Services Activity Expands

(RTTNews) - Japan's service sector logged strong growth but the pace of expansion eased slightly amid a softer upturn in new orders, survey results from S&P Global showed Friday.

The headline final services Purchasing Managers' Index fell to 53.4 in March from a 21-month high of 53.8 in February. The reading was above the initial estimate of 52.8.

There were tentative signs that growth momentum was beginning to fade in March, with both the output and new order indices retreating from the recent highs seen in February, S&P Global Market Intelligence Economics Associate Director Annabel Fiddes said.

New order growth slid to a three-month low and the rate of job creation was the slowest since last October.

Cost pressures intensified in March as the war in the Middle East pushed up oil prices. Input prices grew the most in nearly a year, while output charge inflation softened since February.

The outlook for business activity slipped to the lowest since the pandemic in March due to the uncertainty related to the war in the Middle East.

The composite output index posted 53.0 in March, down from a 33-month record of 53.9 in February. The initial reading was 52.5.

Despite the fall, the rate of expansion was solid and was quicker than the survey's long-run average. Data suggested that output growth slowed across both manufacturing and services.