Japan Composite PMI Hits 33-Month High

Japan’s S&P Global Composite PMI rose to 53.8 in February 2026 from a final 53.1 in the previous month, flash data showed. It marked the highest level since May 2023, driven by faster growth in both manufacturing output and services activity. Overall sales rose at the quickest pace in nearly three years, while new export orders expanded at the strongest rate in eight years, reflecting a sustained rebound in goods demand. Employment continued to increase at a solid pace, though slightly easing from January’s multi-year high. Backlogs of work accumulated at the fastest rate since composite records began in September 2007, underscoring capacity pressures. On the price front, both input costs and output charges rose at slightly faster rates. Looking ahead, business confidence reached a 15-month high, supported by new product launches, stronger tech demand, and the recent landslide election victory of the Takaichi administration.

Japan’s S&P Global Composite PMI rose to 53.1 in January 2026, above the flash estimate of 52.8 and up from 51.1 in December. The latest reading marked the 11th straight month of private-sector expansion and the fastest growth pace since May 2023. Momentum was driven by a stronger pickup in services activity alongside a renewed increase in factory output. New orders expanded at the quickest rate since May 2024, reflecting broad-based gains in demand for both goods and services. Export orders also returned to growth for the first time since last March and at the strongest pace in more than four years. Firms continued to raise staffing levels at a solid clip as order backlogs accumulated. While overall cost pressures eased, selling price inflation accelerated to its fastest rate in over 18 months.

Japan’s S&P Global Composite PMI rose to 52.8 in January 2026 from 51.1 in December, the highest reading since August 2024, flash data showed. It marked the 11th consecutive month of private-sector expansion, supported by the strongest growth in services activity since July and the first, albeit modest, rise in manufacturing output in seven months. New orders increased at the fastest pace since May 2024, while foreign demand expanded for the first time since March. Backlogs surged at the quickest rate since the series began in 2007, adding capacity pressures. Employment rose at the strongest pace since April 2019. On costs, input price inflation eased from December’s eight-month high but stayed elevated, while output prices rose the most in 20 months. Finally, sentiment, however, slipped to its lowest since October, weighed by rising costs, global uncertainty, labor shortages, and demographic challenges, though optimism remained broadly aligned with the survey’s long-term average.