In summary from the report commentary:
- August saw continued positive growth in Japan's service sector, with increases in both activity and new business.
- The growth rate in activity remained steady, while the expansion of new orders slowed.
- Employment rose for the eleventh consecutive month, though the rate of increase slowed to a seven-month low.
- Business optimism remained strong, but also eased to a 19-month low.
- The Japanese private sector showed overall improvement, with the strongest growth since May 2023.
- New orders continued to grow, but rising output was partially due to clearing backlogs, which decreased at the fastest rate in three years.
- Firms remained confident about future output, but optimism weakened to its lowest level since January 2023, with concerns about labor shortages.
On price pressures:
- The latest survey data signalled a strong increase in average cost burdens facing service sector firms. The rate of inflation was little-changed from July and often attributed to higher wage, material and transport costs. Firms opted to partially absorb some of these costs, but prices charged for Japanese services rose at the softest rate since last November.
The flash reading for this is here:
And, the final manufacturing PMI for August is here: