FX.co ★ Japan Service Sector Accelerates In January - Jibun

The service industry in Japan demonstrated continued growth in January, with the pace of expansion even accelerating, according to a recent Jibun Bank survey. The services Purchasing Managers' Index (PMI) was reported to be 53.1, an increase from the previous month's score of 51.5. This figure surpasses the benchmark score of 50, indicating an industry shift from contraction to expansion.

Thanks to increased activity in the service sector, the amount of new business received also grew, thereby perpetuating the growth trend for the 17th consecutive month. This growth spurt further permeated the international market, marking the first increase in overseas demand for Japanese services in five months, largely motivated by recovery in the tourism sector, especially in the airline industry.

The survey also indicated that service sector companies reported an increase in outstanding business for the third straight month. The rate of accumulation was moderate, showing the strongest figures since June of the prior year. This trend is often associated with added pressure on firms' capacity due to sustained growth in new orders.