Asia’s factory activity expands on solid global demand

TOKYO: Asia’s factory activity expanded in January as solid global demand lifted export orders, private-sector surveys showed on Monday, offering policymakers some assurance the hit from higher US tariffs has run its course for now.

Japan and South Korea saw manufacturing activity grow at a multi-year pace as big markets like the US sustained momentum, the surveys showed, brightening prospects for Asia’s export powerhouses.

China’s factory activity expanded at a faster pace in January as export orders rebounded, one of the surveys showed, which contrasted with an earlier official report showing activity faltering.

The RatingDog China General Manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 50.3 from 50.1 in December, exceeding the 50-mark that separates growth from contraction and hitting the highest level since October.

The upbeat survey likely reflects China’s export drive that offset weak domestic consumption and helped the world’s second-largest economy expand 5.0% last year.

Japan’s S&P PMI rose to 51.5 in January from 50.0 in December, the strongest level since August 2022, driven by robust demand from key markets such as the US and Taiwan.

“Japan’s manufacturing industry propelled itself back into growth territory at the start of 2026, with firms signalling the strongest upturns in output and new orders for nearly four years,” said Annabel Fiddes, an economics associate director at S&P Global Market Intelligence.

South Korea’s PMI also rose to 51.2 in January from 50.1 in December to mark the highest reading since August 2024.

The International Monetary Fund raised its 2026 global growth forecast last month on receding fears over the hit from US tariffs, and a continued AI investment boom that has fueled asset wealth and expectations of productivity gains.

Brightening prospects for global demand have helped factory activity expand across Asia.

Taiwan’s PMI rose to 51.7 in January from 50.9 in December, while that of Indonesia rose to 52.6 from 51.2.

Factory activity in Malaysia, the Philippines and Vietnam also expanded in January, the surveys showed.