The final index at the Jibun Bank Japan Services Purchasing Managers’ Index (PMI) rose to 50.7, seasonally adjusted, from 49.4 the previous month. It’s also better than the flash reading of 50.5 for April.
This figure marks the first expansion since December.
“The easing of COVID-19 restrictions allowed customer-facing businesses to operate more freely in April,” said Usamah Bhatti, an economist at S&P Global, which compiles the survey.
Companies in the sector have seen input prices rise at the highest rate since August 2008, due to rising costs of raw materials, fuel and wages, according to the survey.
Overall, private sector companies have faced further increases in cost pressure due to continued material shortages and delivery delays amid the war in Ukraine and the extended lead time. coronavirus-related restrictions in the economic glove that is China, Japan’s main trading partner.
“Private sector companies are commenting on stagnant new order growth…while demand conditions have eased in goods and services businesses,” Bhatti said.
“Cost charges … continued to escalate in April, pushing inflation for input prices and production charges to the second-highest levels in survey history.”
The composite PMI, which is calculated from manufacturing and services, rose at a slightly faster pace than the previous month, rising to 51.1 from 50.3 in March.