The S&P Global Japan Manufacturing PMI was confirmed at 54.5 in May 2026, in line with the preliminary estimate and down slightly from 55.1 in April, which had marked the highest level since January 2022. Although the latest figure pointed to a slower pace of growth, it still signaled solid expansion as output continued to rise.
Production growth was partly underpinned by stockpiling, with firms building inventories as the conflict in the Middle East continued to disrupt product availability and push up costs. Overall new order growth eased somewhat, even as foreign demand strengthened, with new export business rising at the fastest rate in five years.
Purchasing activity increased as manufacturers sought to protect against potential future shortages, while employment continued to grow at a robust pace.
On the price front, input cost inflation accelerated to its highest level since September 2022, reflecting higher material prices. In turn, selling prices rose at the quickest rate since October 2022.
Business sentiment improved, supported by expectations of stronger consumer demand and the development of new products.
