TOKYO—Japan’s manufacturing activity expanded at the slowest pace in five months in February as output contracted, underscoring the prolonged impact that global supply chain disruptions are having on the world’s third-largest economy. Activity in the services sector shrank at the fastest rate since May 2020 as demand weakened after the country saw coronavirus infections spike to a record due to the Omicron variant. The au Jibun Bank Flash Japan Manufacturing PurchasingManagers’ Index (PMI) fell to a seasonally adjusted 52.9 from a final 55.4 in the previous month. A reading below 50 indicates contraction from the previous month, above 50 expansion. “Manufacturers signalled a reduction in output for the first time in five months, though the rate of contraction was considerably softer than that seen in the dominant services sector,” said Usamah Bhatti, economist at IHS Markit, which compiles the survey. The survey showed a marked lengthening of delivery times exacerbated …
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