Capital Economics: Japan PMI supports the Bank of Japan to resume rate hikes in October

Odaily News The latest PMI data from Japan supports Capital Economics' view that the Bank of Japan may raise interest rates sooner rather than later. Japan's composite PMI rose to a four-month high of 51.4 in June. Both the manufacturing and services PMIs rose slightly in June. Capital Economics economist Abhijit Surya wrote that the manufacturing output index pointed to a reacceleration of industrial production, while new export orders pointed to a modest increase in sales. The services PMI was well above the historical average, consistent with the substantial growth in consumer spending. All in all, it is expected that the Bank of Japan has reason to raise interest rates in October, rather than early next year as many expect. (Jinshi)