Japan Industry


Industrial production expands for fourth month in a row

In March, industrial production rose 0.2% over the previous month in seasonally adjusted terms. The reading, which undershot both the 0.6% increase observed in February (previously reported: -0.1% quarter-on-quarter) and market expectations of a 0.4% rise, marked nonetheless a fourth consecutive increase in the production index.
According to the Ministry of Economy, Trade and Industry, the sectors that contributed the most to the monthly increase were chemicals, electronic parts and devices as well as information and communication electronics equipment. As a result of the monthly rise, the government upgraded its assessment on Japan's industrial production, declaring that is now "showing signs of a gradual pickup."

On an annual basis, industrial output declined 7.3% in March, following the 10.5% decrease witnessed in February. As a result, the trend continues to point downwards, with annual average growth in industrial production falling from minus 1.7% in February to minus 3.5% in March.

Meanwhile, the Survey of Production Forecast showed that manufacturers are becoming slightly more optimistic and now see industrial output rising 0.8% month-on-month in April, which is above the 0.6% increase expected in the previous month's survey. However, manufacturers forecast a 0.3% drop in May.

FocusEconomics Consensus Forecast panellists see industrial production expanding 1.0% in 2013, which is unchanged over the previous month's projection. In 2014, the panel expect industrial production to rise 3.6%.

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Japan Industry Chart

Japan Industry March 2013

Note: Month-on-month changes of seasonally adjusted industrial production and year-on-year growth rate in %.
Source: Ministry of Economy, Trade and Industry (METI) and FocusEconomics calculations.

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