Japan’s manufacturing sector’s strong momentum carried through into 2018, growing at its fastest pace in almost four years in January.
The Nikkei-Markit Japan manufacturing purchasing managers’ index rose to 54.8 in January from 54.0 in December.
New order growth rose for a third consecutive month to a four-year high as new business from overseas notched the fastest rate of growth since May 2010.
In turn, positive sentiment for future output hit a four-month high prompting manufacturers to hire more staff.
Rising commodity prices pushed up input prices pressuring companies to raise output prices by the greatest extent since October 2008.
Joe Hayes, economist at IHS Markit said the “robust economic backdrop” had boosted confidence in the sector.
“Sustained output price inflation observed recently in the PMI suggests firms are becoming more confident in the purchasing power of their customers. With a tightening labour market, firms should raise wages to support consumption and in turn, generate domestic inflationary pressures,” Mr Hayes added.