The composite PMI, which includes both manufacturing and services, was largely unchanged in August from the previous month, ticking up to 45. 2 from July’s final 44. 9. “Services saw output fall more quickly than manufacturing for the first time since May, suggesting that the sector is more impacted by the lingering effects of the pandemic on demand,” Harker said. “Any return to growth will likely depend on confidence among companies and customers alike that the virus has been brought under control.
The survey results will be discouraging news for policymakers who are counting on a pickup in domestic spending to help pull the world’s third-largest economy out of a sharp recession. “The COVID-19 pandemic continued to hang over the Japanese service sector in August, halting previous momentum towards recovery amid fragile customer demand,” said Andrew Harker, economics director at IHS Markit.
(Reuters) – Activity in Japan’s services sector contracted at a faster pace in August for the firs time in four months, as uncertainty from the coronavirus pandemic weighed on sentiment, hurting business at home and from abroad.