FX.co ★ Japan Composite PMI Revised Higher

The au Jibun Bank Japan Composite PMI inched up to 50.2 in May 2025, surpassing the preliminary estimate of 48.5, albeit dipping slightly from the 51.2 recorded in the previous month. This outcome represents the second consecutive month of expansion within the private sector, characterized by subdued growth in the service sector and a persistent decline in manufacturing output. New orders witnessed a modest rise, indicative of tepid demand for services and a less pronounced decrease in factory orders. Employment posted modest gains in both sectors, exceeding the historical average levels. On the financial front, input price inflation decelerated to a 14-month low, yet overall cost pressures remained high, prompting a continued increase in selling prices. In terms of business outlook, confidence rebounded from its April low—the weakest since August 2020—fueled by heightened optimism among manufacturers and service providers, although it still lagged behind the 2024 average.