Jibun Bank Manufacturing PMI

What is au Jibun Bank Japan Manufacturing PMI?

The au Jibun Bank Japan Manufacturing PMI is a monthly factory survey of Japanese makers by S&P Global, backed by au Jibun Bank. It asks purchasing managers (buyers of factory inputs) across about 400 firms, grouped by industry and firm size based on GDP shares. Each question asks only the direction of change since the prior month, so it records opinion, not measured output volumes. Replies become 1 headline through diffusion indexes (scores from 0 to 100), where 50 means no change since the prior month.

When is it released and what happens each release?

Replies are gathered in the 2nd half of each month and stay embargoed (kept secret) until 0930 JST (0030 UTC). A flash estimate (early partial result) lands about 1 week before month end, spanning manufacturing, services and the composite (combined) gauge. The final release (full replies) lands on the 1st working day of the next month, with the headline, output, orders, jobs and economist comment. Flash uses about 85% to 90% of replies, answers stay fixed except later tweaks for normal seasonal swings, and 50 splits gain from loss.

What moves au Jibun Bank Japan Manufacturing PMI?

5 parts feed the headline, each with a fixed share.

• New Orders, 30%: captures the path of incoming demand, with export orders tracked apart.
• Output, 25%: captures the path of production volumes.
• Employment, 20%: captures the path of workforce numbers.
• Suppliers' Delivery Times, 15%: captures shifts in vendor lead times, flipped so delays read as weaker demand.
• Stocks of Purchases, 10%: captures the path of input stock levels.

In September 2022 the gauge slid to 50.8 from 51.5 in August 2022. Published 3 October 2022, it was the lowest since January 2021, still above 50 yet hiding soft demand. New orders shrank at the sharpest pace in 2 years as high prices drained buyers across China, South Korea, Europe and the US. Output fell for a 3rd straight month at the fastest pace in a year, while hiring hit a 7 month high. A weak yen lifted import costs near record pace, yet jobs still rose, so the calm headline masked coming output cuts.

How is au Jibun Bank Japan Manufacturing PMI calculated?

1. Survey: managers say whether each item rose, held steady or fell since the prior month.
2. Diffusion index: each item becomes a score from 0 to 100. It equals H + 0.5 x U, where H is the higher share (%) and U is the unchanged share (%).
3. Seasonal adjustment: scores are corrected for normal seasonal swings.
4. Weighted headline: the headline blends the 5 adjusted scores by fixed shares. It uses 0.30 for New Orders, 0.25 for Output, 0.20 for Employment, 0.15 for flipped Delivery Times and 0.10 for Stocks of Purchases.
5. Inversion: delivery times are flipped so longer delays move with weaker demand.
6. Example (illustration only): Use parts at 52, 51, 50, 48 and 49 in the order above. The math gives 15.6 + 12.75 + 10 + 7.2 + 4.9 = 50.45, about 50.5, or slight gain.

Key point: the PMI tracks only direction since the prior month, not output levels. Sister gauges are not comparable with the factory headline, and flash rests on partial replies.