ANN/THE STRAITS TIMES – Japan’s factory output shrank for a third straight month in November as cooling demand overseas pushed production levels further below pre-pandemic levels.
Industrial production inched down 0.1 per cent from October, according to the industry ministry yesterday. Economists had forecast a 0.2 per cent decline. Output also fell 1.3 per cent from a year ago, compared with analysts’ expectations of a 1.5 per cent drop.
The continued falls support the Bank of Japan’s view that the economy’s fragile recovery is still in need of support. Japanese firms, especially manufacturers, are growing increasingly cautious over the outlook as uncertainty grows over the extent of a global slowdown and the possibility of recessions in key overseas markets.
Weakening demand from business partners is already visible in trade figures showing the first month-on-month fall in exports from Japan since the supply-chain snarls of last year.
The figures come after retail sales data released on Tuesday showed an unexpected fall in consumer spending even after the first full month of reopened borders to foreign visitors.
Economists said the drop in spending suggests inflation in Japan is starting to weigh on sentiment after the release of pent-up demand from the pandemic.