Asian factory output grows as global demand boosts exports

Factory activity across Asia expanded in January, supported by steady global demand that lifted export orders, according to private-sector surveys released on Monday. The results suggest the impact of higher US tariffs has eased for now, offering some relief to regional policymakers.

Manufacturing activity in Japan and South Korea grew at multi-year highs as strong demand from major markets, including the United States, continued to support Asia’s export-driven economies.

In China, factory activity expanded at a faster pace in January as export orders rebounded, according to one private survey, contrasting with an earlier official report that pointed to weaker momentum. The RatingDog China General Manufacturing Purchasing Managers’ Index compiled by S&P Global rose to 50.3 from 50.1 in December, its highest level since October and above the 50 threshold that separates expansion from contraction.

The stronger reading reflects China’s reliance on exports to offset weak domestic consumption, helping the world’s second-largest economy grow by 5.0 percent last year.

Japan’s manufacturing PMI climbed to 51.5 in January from 50.0 in December, marking its strongest performance since August 2022. The improvement was driven by robust demand from key markets such as the United States and Taiwan.

Annabel Fiddes of S&P Global Market Intelligence said Japan’s manufacturing sector returned to growth at the start of 2026, with firms reporting the strongest increases in output and new orders in nearly four years.

South Korea’s PMI also strengthened, rising to 51.2 from 50.1 in December, the highest level since August 2024.

The International Monetary Fund (IMF) last month raised its global growth forecast for 2026, citing easing concerns over the effects of US tariffs and continued investment in artificial intelligence, which has boosted asset values and expectations for productivity gains.

Improving global demand has supported manufacturing growth across much of Asia. Taiwan’s PMI rose to 51.7 in January from 50.9, while Indonesia’s increased to 52.6 from 51.2. Factory activity also expanded in Malaysia, the Philippines and Vietnam during the month, the surveys showed.