TOKYO, Reuters – Japan’s factory activity grew at its fastest rate in almost four years in November. This was due to the release of COVID-19 limitations, which withstands the pressure from the largest jump in input prices since 13 years.

The services sector saw an increase in activity, growing at the fastest rate in over two years. This was due to stabilisation of economic conditions after the sharp fall in COVID-19 deaths and cases.

The Seasonally Adjusted 54.2 au Jibun Bank Flash Japan Manufacturing PMI (Purchasing Managements’ Index) grew to its highest pace of expansion since January 2018.

This reading was higher than the final 53.2 from the prior month.

According to Usamah Bhatti (economist at IHS Markit), “Activity in Japanese private sector companies rose for the second consecutive month in November.”

According to the survey, manufacturers’ optimism about the coming year has slowed slightly in comparison with the month before. This was despite the fact that all sectors were facing rising price pressures.

Bhatti explained that the increase in input prices was the fastest rate for more than 13 years. Businesses attributed the change to rising raw material, freight costs and employee costs.

The seasonally adjusted au Jibun Bank Flash Services PMI Index rose to 52.1 from 50.7 in the month before, pushing it further into expansion territory.

This reading was the highest rate of growth in three years, and it occurred just prior to a rise in sales taxes that shook consumer confidence.

Composite PMI of au Jibun Bank Flash Japan, calculated using manufacturing and services, increased to 52.5, from the October final 50.7.