The final Markit/Nikkei manufacturing Purchasing Managers' Index (PMI) for Japan remained unchanged at 52.6 in December, up from the preliminary reading of 52.5.

A reading above 50 indicates expansion, a reading below 50 indicates contraction of activity.

The index was driven by a rise in new orders and output.

"Manufacturing conditions continued to improve at a marked rate in December, contributing to the strongest PMI quarterly average seen since Q1 in 2014. This suggests that the official GDP figure for Q4 2015 will signal some growth. As a result of sharp expansions in both manufacturing production and new orders, employment and buying activity increased further," economist at Markit, Amy Brownbill, said.