Japan’s services activity contracted at a slower than initially estimated pace in March, final data from IHS Markit showed on Monday.
The au Jibun Bank Japan Services Purchasing Managers’ Index rose to 48.3 in March from 46.3 in February. This was well above the flash score of 46.5 but below the neutral 50.0 mark, suggesting contraction in the sector.
The latest reading was the highest since January 2020, as some companies lifted output at the end of the first quarter.
New business inflows fell at a softer pace in the latest survey period. In anticipation of improving orders as the pandemic recedes, Japanese service providers increased employment levels for the second successive month.
Average cost burdens climbed for the fourth straight month in March. However, average prices charged by service providers dropped further.
Business optimism for activity in the next 12 months strengthened to the highest level since May 2013 in March.
The composite output index, which measures combined output in the manufacturing and service sectors, rose to 49.9 in March from 48.2 in February. The flash score was 48.3.