TOKYO -- Japan's service sector continued to grow modestly in May, thanks to sold business activity, new orders and employment, according to a survey.
The Business Activity Index fell slightly from 51.8 in April to 51.7 during May, remaining above the 50-point level separating expansion from contraction.
Continued inflows of new work were cited as the key driver for the resilience in the index.
While respondents of the survey maintained an optimistic outlook, some were concerned about the planned consumption tax hike later this year.
"The current underlying trend in Japan's economy is disappointing and will certainly warrant concern from Abe amid the upcoming upper house elections in July and the scheduled consumption tax hike later this year," said Joe Hayes, Economist at IHS Markit, which compiles the survey.
For more information, visit IHS Markit website.