Japan: Industrial production continues to recover
September 30, 2011
Industrial activity continues to recover slowly from the 11 March disaster amid an uncertain global outlook and a strong yen. In August, industrial production grew 0.8% over the previous month in seasonally adjusted terms, following the revised 0.4% increase observed in July (previously reported: +0.6% month-on-month). While output grew for a fifth consecutive month, the August print undershot market expectations of a 1.5% expansion. On an annual basis, industrial production grew a paltry 0.6% in August (July: -3.0% year-on-year), which was, nevertheless, the first positive reading since the earthquake. The monthly reading was mainly supported by strong growth in transport equipment as well as in electronic parts and devices. On the downside, the information and communication electronics category plunged 10.8% over the previous month. General machinery continued to rise modestly. As reported by the Survey of Production Forecast, manufacturers are less upbeat and see industrial output contracting 2.5% over the previous month in September (previously expected: -2.4% mom), but see manufacturing expanding 3.8% in October.