Gold prices tick higher on fresh U.S. tariff threats, Fed rate cut hopes
Investing.com-- Japanese industrial production grew more than expected in February as local manufacturing picked up amid some resilience in overseas demand, while the front-loading of exports also helped.
But weak local demand, especially in private consumption, saw retail sales miss growth expectations.
Industrial production grew 2.5% month-on-month in Feb, more than expectations of 1.9%, government data showed on Monday.
Local manufacturers were seen ramping up output to frontload exports before the imposition of steep U.S. trade tariffs in early-April, although overall manufacturing still remained weak after a host of disruptions in recent years.
But sectors such as automobiles and electronics face growing headwinds from U.S. tariffs, which could hurt future overseas demand. President Donald Trump is also set to unveil reciprocal tariffs against major U.S. trading partners from April 2, which will likely include Japan.
Domestic Japanese demand, especially among consumers, also appeared to be cooling as sticky inflation weighed on spending ability and sentiment.
Retail sales grew 1.4% year-on-year in Feb, less than expectations of 2.4% and slowing sharply from the 4.4% rise seen in January.
The effects of bumper wage hikes from 2024 also now appeared to be wearing out, although ongoing springtime wage negotiations are expected to yield another round of strong wage hikes.