Japan manufacturing downturn eases slightly in November

Japan's manufacturing sector activity continued to contract in November, although the outlook for the coming 12 months amongst producers was upbeat, S&P Global reported Monday.

The S&P Global manufacturing purchasing managers' index rose to 48.7 in November, up from 48.2 in October. The latest figure came in below the preliminary flash reading of 48.8.

A reading above the 50.0 neutral mark indicates an overall increase in business activity from the previous month, while a reading below signals a contraction.

Annabel Fiddes, economics associate director at S&P Global Market Intelligence, said: "Reduced demand was reported across key markets across Asia, with weaker-than-expected sales across the automotive and semiconductor industries noted in particular."

Data showed that input cost inflation accelerated during November with operating expenses growing at the most pronounced rate since June. Manufacturers lifted their selling prices and typically cited greater costs relating to raw materials and staff.

Workforce numbers rose again in November as manufacturers filled vacancies and prepared for expansions and upcoming retirements. Although the change was "only slight" according to S&P Global, job creation increased at the fastest pace recorded in three months.

"The latest survey indicated that Japanese factories were more upbeat about the 12-month outlook for output in November. Furthermore, the degree of optimism was the highest seen since January amid reports of new product launches and forecasts of stronger customer demand," S&P Global explained.

S&P Global compiles the PMI each month using survey responses from a panel of around 400 manufacturers.