The final Markit/Nikkei manufacturing Purchasing Managers' Index (PMI) for Japan declined to 52.3 in January from 52.6 in December, down from the preliminary reading of 52.4.

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

The index was driven by a slower growth in new orders and a drop in input prices.

"The start of 2016 was generally positive for the Japanese manufacturing sector, with operating conditions improving at a solid rate. Production and new orders increased at robust rates, helping to boost employment numbers and encouraging firms to purchase more during the month," economist at Markit, Amy Brownbill, said.