TOKYO, May 9 (Reuters) – Japan’s service sector activity rose for the first time in four months in April as consumer confidence recovered after the government lifted coronavirus curbs following a drop in domestic infections in Omicron.
The Jibun Bank Japan Services Purchasing Managers’ Index (PMI) final rose to 50.7 seasonally adjusted from the previous month’s final of 49.4. It was also better than a flash reading of 50.5 for April.
The figure marked the first expansion since December.
“The easing of COVID-19 restrictions allowed customer-facing businesses to operate more freely in April,” said Usamah Bhatti, economist at S&P Global, which compiles the survey.
Companies in the sector have seen input prices rise at the fastest pace since August 2008 due to rising costs of raw materials, fuel and wages, the survey showed.
Overall, private sector companies have faced further increases in cost pressures due to persistent material shortages and delivery delays amid the war in Ukraine and the longer fight against coronavirus in economic giant China, Japan’s biggest trading partner.
“Private sector companies commented on stagnant new order growth…as demand conditions eased in goods and services businesses,” Bhatti said.
“The cost burden … continued to escalate in April, pushing both input price and production cost inflation to the second highest levels in survey history.”
The composite PMI, which is calculated using both manufacturing and services, rose at a slightly faster pace than the previous month, rising to 51.1 from 50.3 in March.
(Reporting by Daniel Leussink; Editing by Sam Holmes)
((firstname.lastname@example.org; Twitter: @danielleussink;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.