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Japan: Industrial production drops in July

August 31, 2015

In July, industrial production declined 0.6% over the previous month in seasonally-adjusted terms, which contrasted the 1.1% increase recorded in June. July’s print, surprisingly, contrasted the 0.1% rise that market analysts had expected.

According to the Ministry of Economy, Trade and Industry, the categories that made the greatest contributions to the monthly drop were electronic parts and devices, transport equipment as well as information and communication electronics equipment. Meanwhile, the government maintained its basic assessment of industrial production, stating that output is “see-sawing.”

On an annual basis, industrial output rose 0.2% in July, which was below the 2.3% increase tallied in the previous month. Annual average growth in industrial production inched up from minus 1.2% in June to minus 1.1% in July.

The Survey of Production Forecast showed that manufacturers are becoming slightly more optimistic. They now expect industrial output to have recorded a month-on-month 2.8% expansion in August, which is up from the 2.7% expansion that was forecast in the previous month’s survey. Manufacturers expect a 1.7% contraction in August.

FocusEconomics Consensus Forecast panelists see industrial production expanding 1.1% in 2015, which is down 0.5 percentage points over the previous month’s projection. In 2016, the panel expects industrial production to rise 2.4%.


Author: Ricard Torné, Head of Economic Research

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Japan Industry July 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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