June 29, 2011 / 11:20 PM / 8 years ago

Japan June manufacturing PMI edges down

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TOKYO, June 30 (Reuters) - Japanese manufacturing activity slowed slightly in June as new business orders stagnated, but output grew by the most in four months as companies brought forward production to avoid possible power shortages during the summer, a survey showed on Thursday.

The Markit/JMMA Japan Manufacturing Purchasing Managers Index (PMI) fell to a seasonally adjusted 50.7 in June from 51.3 in May. The index remained above the 50 threshold that separates contraction from expansion for a second straight month.

The index for new orders rose slightly to 50.0 in June from 49.8 in May. In April the index stood at 37.7.

The output component of the PMI index rose in June to 52.7 from 51.5 in the previous month, reaching the highest level since February.

“The latest findings indicated that easing supply side pressures had enabled firms to expand their factory output,” said Alex Hamilton, an economist at Markit.

“This occurred despite a stagnation of new order levels, as firms continued to stockpile finished goods, in anticipation of summer power shortages, and complete backlogs of work accrued amid the disruption caused by the recent natural disaster.”

The index for new export orders, a leading indicator of Japanese exports, fell slightly to 49.0 in June from 49.2 in the previous month. (Reporting by Stanley White; Editing by Michael Watson)

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