FX.co ★ Japan Services Sentiment Below Estimates

In June 2025, Japan's service sector index climbed to 45.0, inching up from 44.4 in the previous month, yet falling slightly short of market forecasts of 45.2. Despite this uptick, the reading continued to indicate overall contraction for the fifteenth successive month, largely due to persistent challenges in the service industry and unfavorable employment conditions. On a positive note, household-related activities showed signs of improvement, bolstered by growth in the food and beverage sector. Business-related trends also saw an uptick, thanks to gains in the non-manufacturing sector. Additionally, the economic outlook index rose to 45.9 in June, an increase from 44.8 in May, reaching its highest point in four months. This was underpinned by expectations of summer bonuses and wage increases, although there were still concerns regarding the signs of a tepid economic recovery.