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The final Markit/JMMA Japan Manufacturing
Purchasing Managers Index (PMI) was 52.0 in December, slightly
less than a preliminary reading of 52.1 and unchanged from the
final reading in November.
It remained above the 50 threshold that separates contraction
from expansion for the seventh consecutive month.
The output component of the PMI index was 52.5, less than a
preliminary reading of 53.3 and slightly below 52.7 in November.
New export orders rose for a sixth straight month but at a
slightly slower pace than in November.
The economy unexpectedly slipped into recession in the third
quarter of last year as a sales tax increase in April hit
consumer spending harder than expected, while exports were
uneven for most of the year.
However, the economy is expected to have resumed expansion in
the fourth quarter as consumer spending recovered and companies
increased capital expenditure.
Late in December, Japan's government approved stimulus spending
worth $29 billion aimed at helping the country's lagging regions
and households with subsidies, merchandise vouchers and other
steps, though analysts are skeptical about how much it can spur
growth.
The package, worth 3.5 trillion yen, was unveiled two weeks
after a massive election victory by Prime Minister Shinzo Abe's
ruling coalition gave him a fresh mandate to push through his "Abenomics"
policies to reflate the long-moribund economy, a strategy which
has so far had mixed results.
The government said it expects the stimulus plan to boost
Japan's GDP by 0.7 percent.
The government is also expected to start cutting corporate taxes
from April in a bid to spur more activity and encourage firms to
pay higher wages.
(Reporting by Stanley White; Editing by Kim Coghill)
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