Nikkei / Markit flash manufacturing PMI for January ... nearly a 4 year high

Key points: 

  • Flash Japan Manufacturing PMI® rises to 54.4 in January (54.0 in December). 
  • Output expands at quickest rate in 47 months. 
  • New orders continue

Joe Hayes, Economist at IHS Markit:

  • January flash PMI data for the Japanese manufacturing economy signalled further positivity. The sector has observed accelerated rates of improvement in each of the past three months.
  • The strongest reading in the PMI since February 2014 was supported by quickened rates of output and employment growth, in addition to a relatively sharp expansion in new orders.
  • Strikingly, output price inflation accelerated to the fastest rate since October 2008 amid sharper rises to input costs. With a low rate of unemployment and sustained growth in official GDP data, inflationary pressures should continue to mount.

That last point might give the BOJ some encouragement in its quest for 2% CPI. We get inflation data out of Japan on Friday. It won't be close to 2%, but will it even be moving in the desired (for the Bank of Japan) direction?

Earlier today: