Jibun Bank / Markit final PMIs for January - those in the headlines are the preliminary not the priors.
- services prior was 49.4
Markit comments on the release:
- Latest PMI data will come as a relief that Japan's service sector - which has essentially been driving economic growth for around a year now - has recovered from the sales tax hike and typhoon disruption, which had quite the overhang in the fourth quarter.
- Stronger growth in demand and employment instil some confidence that short-term economic prospects are not as bad as feared at the end of last year.
- That said, business confidence dropped to a 29-month low in January, with concern towards the ageing working population and low-growth environment restricting expectations in the year ahead. While the Tokyo Olympic Games will certainly provide a boost to economic activity this year, firms are looking past temporary factors and are showing early signs of concern for Japan's growth potential.
The February data may show a greater impact from the viral outbreak in China, something to bear in mind.
