Japan Industry

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Japan: Growth in industrial production accelerates strongly in January

February 27, 2015

In January, industrial production expanded 4.0% over the previous month in seasonally-adjusted terms, which followed the revised 0.8% increase recorded in December (previously reported: +1.0% month-on-month). The print largely overshot the 2.7% increase that market analysts had expected and represented the fastest expansion since June 2011.

According to the Ministry of Economy, Trade and Industry, the categories that made the greatest contributions to the monthly rise were general-purpose, production and business oriented machinery, transport equipment and electrical machinery. As a result of January’s healthy growth, the government maintained its general assessment of industrial production, stating that, “industrial production is recovering moderately.”

On an annual basis, industrial output fell 2.6% in January, which contrasted the 0.1% increase tallied in the previous month. As a result of the subdued year-on-year variation, annual average growth in industrial production ticked down from 2.1% in December to 1.0% in January.

Meanwhile, the Survey of Production Forecast showed that manufacturers are becoming more optimistic. They now expect industrial output to have recorded a month-on-month 0.2% expansion in February, which contrasted the 1.8% drop that was forecast in the previous month’s survey. Manufacturers, however, expect a 3.2% decline in March.

FocusEconomics Consensus Forecast panelists see industrial production expanding 1.0% in 2015, which is down 0.1 percentage points over the previous month’s projection. In 2016, the panel expects industrial production to rise 1.9%.


Author: Ricard Torné, Lead Economist

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Japan Industry January 2015

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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