Capital Economics: Japan's PMI supports the Bank of Japan's resumption of interest rate hikes in October

ChainCatcher news, according to Jinshi Data, the latest PMI data from Japan supports Capital Economics' view that the Bank of Japan may raise interest rates sooner than expected.

Japan's composite PMI rose to 51.4, a four-month high in June. Both manufacturing and services PMIs saw a slight increase in June. Capital Economics economist Abhijit Surya noted that the manufacturing output index indicates a re-acceleration of industrial production, while new export orders suggest moderate growth in sales. The services PMI is well above the historical average, consistent with substantial growth in consumer spending.

In summary, the Bank of Japan is expected to have reasons to raise interest rates in October, rather than in early next year as many anticipate.