Breaking News
Investing Pro 0
🚨 Our Pro Data Reveals the True Winner of Earnings Season Access Data

Japan industrial production slumps further in Oct, outlook improves

Economic Indicators Nov 30, 2022 01:12
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.
 
USD/JPY
+1.24%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

By Ambar Warrick

Investing.com-- Japanese industrial production fell further in October as elevated raw material costs and slowing overseas demand saw local industries scale back output, although the outlook for production in the coming months appeared to have improved.

Industrial production sank 2.6% in October from the prior month, data from the Ministry of Trade, Economy and Industry showed on Wednesday, much more than estimates for a drop of 1.5% and also ahead of last month’s 1.7% decline.

The reading also missed the Ministry of Trade’s forecast for a 0.4% decline.

But production rose 3.7% from the prior year, indicating that Japan’s manufacturing sector was seeing some signs of recovery after the lifting of COVID-related restrictions this year.

Still, makers of industrial machinery, automobiles, and electronics continued to face near-term headwinds from more expensive input costs and weakening export demand. Shipments sank 1.1% in October from the prior month.

Rising inflation is one of the biggest weights on the Japanese economy this year, with increased costs weighing on producers as well as consumers. Data on Tuesday showed Japanese retail sales sank further in October, as inflation hit a 40-year high during the month.

Still, the Ministry of Trade forecast improving trends for production in the coming months, thanks to increased production of industrial machinery and chemicals. Production is forecast to rise 3.3% in November and 2.4% in December.

But this is contingent on whether Japanese industries can navigate an increasingly adverse environment, with inflation broadly expected to trend higher for the remainder of the year.

A weakening yen also weighed on export margins this year. The Japanese currency is trading down nearly 20% for 2022, as the gap between local and U.S. interest rates widened.

Despite the weakening currency and increased inflation, the Bank of Japan has so far given no indication that it intends to tighten monetary policy.

Japan’s economy unexpectedly shrank in the third quarter, and is expected to remain under pressure for the remainder of the year.

The yen fell 0.1% to 138.81 against the dollar after Wednesday’s reading.

Japan industrial production slumps further in Oct, outlook improves
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email