January 7, 2019 / 12:39 AM / 15 days ago

Japan December services sector PMI shows weakest growth in three months

FILE PHOTO: Customers have lunch at restaurants next to a record shop which has a large poster on its wall in Tokyo, Japan, July 4, 2018. REUTERS/Kim Kyung-Hoon

TOKYO, (Reuters) - Growth in Japan’s services sector slipped in December to the slowest in three months on some reduction of momentum in generating new business at the end of the year, a private showed on Monday.

The Markit/Nikkei Japan Services Purchasing Managers Index (PMI) stood at 51.0 on a seasonally adjusted basis in December, down from 52.3 in November.

That marked the 27th straight month that the index held above the 50 threshold that separates expansion from contraction.

The survey points to “relatively solid” growth in the fourth quarter, but the services sector is lagging behind manufacturing, according to Joe Hayes, economist at IHS Markit, which compiles the survey.

The composite PMI, which includes both manufacturing and services, fell to 52.0 in December from 52.4 in November.

A separate survey on Friday showed Japanese manufacturing activity expanded in December at a better clip than seen in a preliminary poll, as output increased at the fastest pace in eight months.

Japan is scheduled to raise the nationwide sales tax to 10 percent from 8 percent in October 2019, which is making some policymakers worry about a fall in consumer spending.

Reporting by Stanley White; Editing by Richard Borsuk

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