FX.co ★ Japan Services PMI Revised Upward

In January 2026, Japan's S&P Global Services PMI climbed to 53.7, exceeding both the preliminary estimate of 53.4 and the previous December's figure of 51.6. This outcome marked the tenth consecutive month of growth in the services sector and represented the most rapid expansion since February 2025. The increased pace of activity was driven by robust new orders, which reached their fastest rate in four months. This was primarily due to successful marketing strategies, the acquisition of new clients, and stronger overseas demand. Concurrently, there was a significant accumulation of backlogs, the steepest since last September, prompting firms to increase their capacities by hiring more staff. Although the rate of job creation decelerated from December levels, employment remained stable. On the pricing front, input cost inflation slowed to its lowest in nearly two years, yet the inflation of selling prices rose to a seven-month peak as companies transferred these costs to consumers. Looking forward, business optimism diminished to its weakest point since July, influenced by concerns about global economic conditions, declining tourism demand, and ongoing labor shortages.