Japan: Industrial production expands at fastest pace in 18 months
January 31, 2013
In December, industrial production rose 2.5% over the previous month in seasonally adjusted terms. The reading, which marked the strongest increase since June 2011, contrasted the 1.4% contraction observed in November but fell short of the 4.1% expansion expected by the market.
According to the Ministry of Economy, Trade and Industry, the sectors that contributed the most to the monthly rise were transport equipment, general machinery as well as electrical machinery. Despite weaker-than-expected growth, the government upgraded its assessment on Japan's industrial production, stating that "output shows signs of having bottomed out."
On an annual basis, industrial production declined 7.8% in December, following the 5.5% decrease witnessed in November. In the full year 2012, industrial production declined 0.3% over the same period the previous year. The annual fall, nevertheless, represented an improvement over the 2.4% contraction tallied in 2011.
The Survey of Production Forecast showed that manufacturers are becoming more optimistic and now see industrial output rising 2.6% month-on-month in January, which is above the 2.4% increase expected in the previous month's survey. Moreover, manufacturers forecast a 2.3% rise in February.