FX.co ★ Japan’s Manufacturing PMI Slips Below Neutral Threshold to 48.8 in July

The recent au Jibun Bank Manufacturing Purchasing Managers’ Index (PMI) report for Japan indicates a contraction in the manufacturing sector, with the PMI sliding to 48.8 in July 2025. This decline marks a dip below the neutral threshold of 50.0, in contrast to the previous month’s reading of 50.1, signaling a slowdown in manufacturing activities.

Released on 24 July 2025, the latest data highlights challenges faced by Japan's manufacturing sector, including potential disruptions in supply chains or shifts in global demand. The PMI serves as a critical indicator of manufacturing performance and overall economic health, with a reading below 50.0 suggesting a contraction in manufacturing output.

This slide may prompt economic strategists and policymakers to assess the underlying factors contributing to this decline and implement strategies to boost manufacturing activities, ensuring sustained economic growth in the upcoming months.