Sunday,21st April 2019

Sunday, 21st April, 2019

Japan’s factory output growth slumps in April

By Stanley White

Japan’s industrial output was well short of market expectations in April, official figures showed on Thursday, adding to fears for the outlook after the economy contracted in the first quarter.

Industrial output rose just 0.3 percent in April from the previous month, official data showed on Thursday, well below the median forecast for a 1.2 percent increase and a 1.4 percent rise in March.

Much of the slowdown was due to a 5.6 percent decline in production of electronic parts while inventories rose for a third straight month, adding to fears of weakening overseas demand.

Output is seen likely to weaken further as companies focus on lowering inventories of unsold goods, suggesting Japan’s economic performance peaked last year and this year growth will be more modest.

“Production is slowing overall because companies with high inventories are cutting their output,” said Asuka Sakamoto, economist at Mizuho Research Institute.

“Output will fall in the coming months, but I expect consumer spending to rebound in the second quarter, which should be supportive for economic growth. I’m not worried about a recession.”

Manufacturers surveyed by the Ministry of Economy, Trade and Industry expected output to rise 0.3 percent in May but to fall 0.8 percent in June.

Japan’s economy contracted in the first quarter as weak investment, consumption and exports took their toll, with Thursday’s output data and forecasts adding to concerns over how quickly the economy can return to growth.

On the positive side, production of cars and machines used in factories accelerated in April.

© (c) Copyright Thomson Reuters 2018.


Related News

Nissan cuts back on more business at English plant

Infiniti Motor Co, the luxury division of Japanese automaker Nissan, says it's withdrawing from...Full News..

Paper container keeps shampoo in, bathroom water out

Industry leader Toppan Printing Co. has developed an innovative paper container for shampoo and...Full News..

Cabinet approves bill to lower mobile fees

The cabinet of Prime Minister Shinzo Abe on Tuesday approved a proposed legal revision to lower...Full News..

Rakuten EXPRESS expands service area to 14 cities in metropolitan Tokyo

Rakuten Inc has expanded the coverage area of the Rakuten EXPRESS door-to-door delivery service to...Full News..