Japan manufacturing PMI slips to 54.1, a six-month low, as new order growth slows

The reading is still well above the 50 line, so the story is slower growth rather than a downturn, but the drop to a six-month low in a sector reliant on overseas demand will keep attention on how long export strength can last. Sharp cost increases tied to energy, transport and a weak yen, with the Middle East war cited by firms, show that oil and currency moves are still feeding straight into factory prices. Persistent selling price increases are also relevant to the Bank of Japan's assessment of inflation. References to semiconductors and AI-related demand will matter for Asian chip and technology shares, while shortages of electronic components are a risk to output. This is a single survey, so traders will want confirmation from other activity data. --- Earlier: Japanese firms expect consumer prices to rise 2.6% a year from now, down from 2.7% BOJ opinions show members open to faster hikes if inflation risks overshooting 2% target --- Japanese factories are still expanding strongly, but slower orders, supply shortages and persistent cost pressure show that momentum is softening from August's high. Summary: The S&P Global Japan Manufacturing PMI slipped to 54.1 in September from 54.9 in August, its lowest in six months but still a solid expansion. Output rose at the slowest pace in three months, and new order growth eased from August's multi-year record to its slowest since May. New export orders rose sharply, close to August's eight-and-a-half-year high, and employment rose at the second-fastest rate since April 2018. Supplier delivery delays were among the steepest in four years, with shortages of electronic components and AI-related technology widely cited. Input cost inflation edged down to a six-month low but stayed rapid, and selling prices rose at one of the quickest rates since late 2022. Manufacturers remain confident that output will rise over the next year, with semiconductor and AI-related demand cited. Japan's manufacturing sector kept expanding stron