Japan: Industrial production continues to improve in April
May 31, 2013
In April, industrial production rose 1.7% over the previous month in seasonally adjusted terms. The reading, which overshot both the 0.9% increase observed in March (previously reported: +0.2% quarter-on-quarter) and market expectations of a 0.6% rise, represents a fifth straight 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 transport equipment, electronic parts and devices as well as precision instruments. Amid the continued improvement seen in recent months, the government maintains its assessment that Japan's industrial production is "showing signs of a gradual pickup."
On an annual basis, industrial output declined 2.3% in April, following the 6.7% decrease witnessed in March. As a result, the trend continues to point downwards, with annual average growth in industrial production falling from minus 3.4% in March to minus 4.5% in April.
Meanwhile, the Survey of Production Forecast showed that manufacturers are becoming slightly more optimistic and now see industrial output recording a flat month-on-month reading in May, which is above the 0.3% decrease expected in the previous month's survey. However, manufacturers forecast a 1.4% drop in June.
FocusEconomics Consensus Forecast panellists see industrial production expanding 0.3% in 2013, which is down 0.4 percentage points over the previous month's projection. In 2014, the panel expect industrial production to rise 3.9%.