Latest Japanese purchasing index points to supply chain recovery

The Japanese Manufacturing Purchasing Managers Index (PMI) expanded in January at the fastest pace in five months, indicating companies have recovered from major supply chain disruption.

The index remained above the 50 threshold that separates contraction from expansion for two consecutive months. The index also marked the highest reading since 51.9 in August 2011.

"January PMI data suggest that the sector has begun 2012 on a firmer footing following a year in which supply chain disruptions emanating from March's earthquake and flooding in Thailand disrupted firms' production plans," said Alex Hamilton, an economist at Markit.

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