TOKYO, March 24 (Reuters) - Japan's manufacturing
activity contracted for a fifth straight month in March as
output and new orders remained under pressure, a survey showed
on Friday, suggesting the economic recovery is fragile as global
demand slows.
However, service-sector activity expanded for a seventh
straight month and rose at the fastest pace in over nine years
as the squeeze from the coronavirus pandemic eased.
The au Jibun Bank flash Japan manufacturing purchasing
managers' index (PMI) stood at a seasonally adjusted 48.6 in
March, from a final 47.7 in the previous month.
The index remained below the 50-level that separates
contraction from expansion for a fifth straight month in March.
"Manufacturing firms signalled further downbeat figures at
the end of the first quarter, with sustained reductions in both
output and new orders," said Usamah Bhatti, economist at S&P
Global Market Intelligence, which compiles the survey.
Both factory output and new orders declined for a ninth
straight month but the pace of contraction eased from February,
the sub-index data showed.
The Reuters Tankan survey on Thursday showed big Japanese
manufacturers remained pessimistic about business conditions for
a third straight month in March, reflecting worries about
slowing global growth that could hurt the country's export
engine.
In contrast, service sector activity growth was solid.
The au Jibun Bank flash services PMI rose to 54.2 seasonally
adjusted in March from the previous month's 54.0, the fastest
pace since October 2013.
"Stronger demand conditions were reported as the sustained
government support for the sector continued and held up both
activity and new orders," said Bhatti.
Overall, the au Jibun Bank Flash Japan composite PMI was at
51.9 in March, advancing from last month's final figure.
(Reporting by Kaori Kaneko; Editing by Sam Holmes)
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