(Corrects to fix typographical error in paragraph 2)
TOKYO, Feb 1 (Reuters) - Japan's factory activity
contracted for a third straight month in January, a private
survey showed on Wednesday, although manufacturers' outlook
remained upbeat on improved supply and price conditions.
Amid worsening global economic conditions, Japanese
companies are facing calls for higher wage hikes at spring
labour talks to counter inflation and support the
consumption-led recovery in the world's third-largest economy. The au Jibun Bank Japan Manufacturing Purchasing Managers'
Index was at 48.9 in January, unchanged from the flash reading
and the previous month's final figure, which was the weakest
level since October 2020.
"Subdued global economic conditions continued to hold back
customer demand across the Japanese manufacturing sector," said
Tim Moore, economics director at S&P Global Market Intelligence,
which compiles the survey.
The data follows weak December factory output figures
released on Tuesday.
Output and new orders contracted for a seventh consecutive
month in January, although at a slower pace than in the previous
two months, the S&P survey's subindexes showed.
On the bright side, supplier delays were the least prevalent
since February 2021, suggesting improvement in the tight supply
of parts such as semiconductors. Input and output price
inflation were the slowest in 16 months.
"Hopes of a sustained improvement in supplier performance,
alongside a reduced headwind from the pandemic, helped to
support a further upturn in business confidence at the start of
2023," Moore said.
Around three times as many manufacturers in the survey
expect production to expand in the next 12 months as those that
foresee a contraction, according to Moore.
The subindex gauging respondents' future output rose to a
three-month high, the data showed.
(Reporting by Kantaro Komiya; Editing by Kim Coghill)
