TOKYO: Japanese manufacturers raised output to the highest level in five months in March, a survey showed yesterday, supporting a bullish outlook for the economy that has persisted despite a recent series of weak figures.
The survey comes just a day before the closely followed Tankan quarterly business survey from the Bank of Japan, and the central bank's governor added his voice to the optimistic outlook in an address to parliament.
The NTC Research/Nomura/JMMA Purchasing Managers Index, which gives an early snapshot of manufacturing activity, rose to a seasonally adjusted 52.6 in March from 51.7 in February.
“The PMI survey indicates that we've seen a bottoming out of GDP (gross domestic product) and things are looking better in 2005,” said Chris Williamson, senior economist at NTC Research – a British-based firm that compiles the PMI based on responses from more than 350 manufacturers.
“Certainly during the first half of the year we should see the GDP growth picking up.”
A reading above 50 suggests a business expansion, while a figure below points to a contraction. The PMI has risen each month since posting an 18-month low in December.
The readings differed from weak government data for output, employment and trade for February that had cast some doubt on the strength of Japan's recovery from last year's shallow recession.
A recent slowdown in the high-tech sector was likely to end soon, bolstering exports and production, he said, adding that corporate earnings and capital spending were also set to continue rising. – Reuters