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Japan: Industrial production rebounds strongly in September

October 29, 2014

In September, industrial production expanded 2.7% over the previous month in seasonally-adjusted terms, which contrasted the revised 1.9% drop recorded in August (previously reported: -1.5% month-on-month). The print overshot the 2.2% increase that market analysts had expected and represented the largest monthly gain since January.

According to the Ministry of Economy, Trade and Industry, the categories that made the greatest contributions to the monthly contraction were transport equipment, electronic parts and devices as well as electrical machinery. As a result of September’s strong rebound, the government upgraded its general assessment of industrial production for the first time this year, stating that, “industrial production fluctuates indecisively.”

On an annual basis, industrial output rose 0.6% in September, which contrasted the 3.3% decrease tallied in the previous month. Nevertheless, annual average growth in industrial production ticked down from 4.2% in August to 3.8% in September.

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% decline in October, which was above the 0.1% drop that was forecast in the previous month’s survey. In addition, manufacturers expect a 1.0% expansion in November.

FocusEconomics Consensus Forecast panelists see industrial production expanding 2.5% in 2014, which is down 0.4 percentage points over the previous month’s projection. In 2015, the panel expects industrial production to rise 1.6%, which is down 0.2 percentage points from last month’s estimate.


Author: Ricard Torné, Head of Economic Research

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Japan Industry September 2014

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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