Japan Industry May 2019

Japan

Japan: Industrial production expands at fastest pace in 15 months in May

June 28, 2019

Industrial production rose 2.3% on a month-on-month and seasonally-adjusted basis in May, following April’s 0.6% increase. The print overshot the 0.7% increase that market analysts had expected and represented the strongest expansion since March 2018.

The categories that drove the month-on-month increase were motor vehicles, electrical machinery, and information and communication electronics equipment as well as production machinery, in that order. Higher output for these categories was partially offset by decreases in production of inorganic and organic chemicals, transport equipment (excluding vehicles) and chemicals.

On an annual basis, industrial output fell 1.8% in May, following the 1.1% decrease in April. The annual average variation in industrial production fell from a flat reading in April to minus 0.4% in May.

The Survey of Production Forecast showed that manufacturers are slightly more optimistic. They now expect industrial output to have recorded a 1.2% monthly decrease in June, up from the 4.2% contraction forecast in the previous month’s survey. Manufacturers, however, expect a 0.3% increase in July.

FocusEconomics Consensus Forecast panelists see industrial production rising 0.7% in 2019, which is down 0.4 percentage points over the previous month’s projection. For 2020 the panel expects industrial production to expand 1.0%.


Author: Ricard Torné, Lead Economist

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Japan Industry May 2019

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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