Japanese Manufacturing Sector in Contraction for Sixth Consecutive Month in October
Japan’s manufacturing activity continued to contract for the sixth consecutive month, falling to the lowest levels in three years during October. The Jibun Bank Final Japan Manufacturing PMI slid to a seasonally-adjusted 48.4 in October from 48.9 in September.
The last time the manufacturing sector remained in contraction for a six-month stretch was between March and August in 2016. Ongoing trade tensions between the US and China have had a severe spillover effect on Japan’s manufacturing sector as China is one of its most important trading partners.
The contraction became more pronounced as new orders declined at the fastest pace seen since May 2016, for the 10th consecutive month. In addition, factory output and new export orders also continued to contract during October.
The release of this news has failed to make much of an impact on the Japanese yen, with USD/JPY trading somewhat steady around 107.97 at the time of writing.
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