Japan data rises services activity at its fastest pace in eight months in April, as demand is strong

(1) A private poll on Tuesday showed that Japan's service sector activity rise at its fastest pace in eight months in April, driven by strong corporate and consumer spending. This should make the Central Bank still expected to raise interest rates again this year. (2) Japan's Au Jibun Bank Services Purchasing Managers' Index (PMI) rose to 54.3 in April, the highest since August 2023, slightly higher than 54.1 in March, but slightly lower than the preliminary reading of 54.6. Since September 2022, the index has remained above the 50-year-old watershed. (3) The survey showed that the prices charged by companies to customers have pumped sharply, and inflation has hit its highest level since the government raised sales tax in April 2014. (4) Japan has been urging companies to raise wages steadily for Central Bank long years to stimulate consumption. The services sector has been a bright spot in the economy, helping to offset some of the impact of continued weakness in the manufacturing sector. Strong business and consumer spending from the latest survey should be welcome news for policymakers. (5) Tim Moore, director of economics at S&P Global Market Intelligence, said, "April data showed that Japan's services sector was once again strong, with rise in business and consumer spending driving the fastest recovery in business activity since August 2023." ” (6) New business rises for the sixth month in a row, the fastest pace since June 2023, and companies said strong inbound tourism also boosted sales, the survey showed. (7) Input prices rose at the fastest pace since August due to rise labor costs and pump higher transportation and raw material prices, driving a sharp pump in prices charged to customers. (8) "Service providers are increasingly long seeking to negotiate higher prices with their customers in response to the rise of cost pressures," Moore said. ” (9) The composite PMI for the composite manufacturing and services activity data rose to 52.3 in April from 51.7 in March, the highest level since August 2023