Japan’s Manufacturing Grew Steadily in September, Exports Close to 2-years Low

The manufacturing activity of Japan grew steadily in September based on the revised survey on Monday despite the export orders, as well as production, dropped to an almost two-year low in the background of global trade protectionism.

The final Markit/Nikkei survey showed a decline to a seasonally adjusted figure of 52.5 from a flash reading of 52.9 but remained the same from last month.

The 50th figure separates the expansion from contraction for 25 succeeding months but failed to meet the future output of 22-month low amid global trade war.

However, an economist at IHS Markit, Joe Hayes, said that the average PMI reading was “weaker” than the first two quarters this year indicating lesser drive.

Although, corporate confidence continues to be positive with output levels expected to higher in 12 months, however, the degree of confidence slid to a 22-month low. Some panel members have raised concern over this.

The sub-index forecast was adjusted higher to 56.8 from the preliminary of 55.9, which is the lowest sentiment since November 2016.

As for the exports orders index, it was revised lower to 49.8 from a flash reading of 50.9 for two succeeding monthly declines.

Yet, analysts are concerned with the worsening trade war between the US and China that could affect economic growth in both large nations.