Japan Composite PMI Revised Lower

Japan’s S&P Global Composite PMI Business Activity Index eased to 52.1 in October 2026 from the flash estimate and September reading of 52.3. It marked the lowest reading since May but extending private-sector growth for a 19th consecutive month. A slightly faster expansion in services activity was offset by slower manufacturing output growth. Total new orders increased at the same modest pace as in September, while overall sales continued to benefit from higher export demand, although new export business growth slowed to a four-month low. Meanwhile, employment growth weakened to its slowest pace in a year, while business confidence in the year-ahead outlook fell to a three-month low, suggesting moderating optimism. On the price front, input costs continued to rise sharply by historical standards, although the pace of inflation in output prices eased to a four-month low.

Japan’s S&P Global Composite PMI Business Activity Index held steady at 52.3 in October 2026, unchanged from September’s final reading, flash data showed. This marked the 19th consecutive month of private-sector expansion, although growth remained at its slowest pace since May. Stronger services activity was accompanied by the slowest increase in manufacturing output since March. New orders grew at their weakest pace in three months, while new export orders continued to rise. Employment growth slowed to a 14-month low, with hiring trends diverging between sectors, while backlogs of work increased further. On the price front, input costs rose sharply, but selling price inflation eased to a four-month low. Meanwhile, persistent inflation concerns weighed on business sentiment, with year-ahead output expectations falling to their lowest level since July.

Japan’s S&P Global Composite PMI Business Activity Index eased to 52.3 in September 2026 from 53.5 the previous month and a flash estimate of 52.5. While marking the 18th consecutive month of private-sector expansion, the latest result was the slowest growth since May, with activity growth moderating across both manufacturing and services. Total new business increased at a softer and more modest pace, while new export business remained solid, driven entirely by manufacturers. Employment rose at its fastest pace since February, alongside a stronger increase in backlogs of work, suggesting continued capacity pressures. On prices, inflationary pressures remained historically elevated, although growth in input costs and output charges eased from August. Finally, business confidence improved to a seven-month high, indicating firms remained optimistic about activity over the coming year.