Japan Services PMI Eases in September Amid Persistent Price Pressures

Key Facts

Japan's Services PMI eased to 51.3 in September 2026 from a five-month high of 52.5 in August, according to S&P Global. Reuters reported that output prices rose at one of the fastest rates on record, a factor that supports the case for further interest rate hikes by the Bank of Japan as underlying inflation remains sticky.

Employment in the sector grew at its fastest pace since February 2026, as backlogs of work increased at the steepest rate in seven months according to Investing.com. While earthquake disruptions and weak export demand weighed on headline growth, rising wages and input costs have prompted firms to hike output prices, potentially clearing the path for a central bank move in October 2026.