16.12.202500:52:49UTC+00Japan Manufacturing Downturn Eases in December

In December 2025, the S&P Global Japanese Manufacturing PMI increased to 49.7 from 48.7 in November, surpassing the anticipated figure of 48.8 and achieving its peak level since August. This shift suggests a moderation in the decline of manufacturing activity. Demand conditions showed improvement, with the demand for goods contracting at the most gradual rate observed in approximately 18 months. However, there was a reduction in new export orders due to a continued slump in international demand for manufactured products. The manufacturing sector also experienced job growth, driven by signs of stronger overall demand conditions, and noted the smallest decrease in unfinished work in a year and a half. On the cost front, the latest survey revealed a continued steep rise in average operating expenses, with input price inflation reaching its highest rate in eight months. Looking to the future, Japanese companies anticipate an increase in output throughout 2026, buoyed by expectations of augmented client demand, the introduction of new products, and plans to venture into new markets.