A worker bicycles near a factory at the Keihin Industrial Zone in Kawasaki, Japan, February 28, 2017. REUTERS/Issei Kato
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- April production falls 1.3% m/m, much weaker than expected
- Manufacturers see an increase in production in May, June
- Retail sales rise more than expected in April
TOKYO, May 31 (Reuters) – Japan’s factories saw output fall sharply in April as China’s COVID-19 lockdowns and broader supply disruptions took a heavy toll on manufacturers and clouded the outlook for the trade-dependent economy.
Separate data showed that retail sales posted the biggest rise in nearly a year, as consumers increased spending after the government eased pandemic restrictions and weathered pressure from broader price hikes that threaten to hurt demand at home.
Factory production fell 1.3% mom in April, official data showed on Tuesday, due to a sharp decline in output of items such as electronic parts and production machinery.
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It was the first drop in three months and much weaker than the 0.2% drop expected by economists in a Reuters poll.
The data comes a day after Toyota Motor Corp (7203.T), the world’s top-selling automaker, missed its global production target for April after production fell more than 9% year-on-year. Continue reading
Toyota’s production slump last month came after the Japanese automaker on Friday cut its global production plan for June and signaled a possibility of lowering its full-year production plan of 9.7 million vehicles. Continue reading
While activity in Japan’s service sector picks up again as the pandemic abates, the country’s manufacturing sector has been squeezed by supply disruptions and higher material prices caused by Russia’s war in Ukraine.
Manufacturers surveyed by the Ministry of Economy, Trade and Industry (METI) expected production to return to growth in May, rising 4.8%, followed by an 8.9% increase in June.
Separate data showed that retail sales rose 2.9% year-on-year in April, the sharpest increase since May 2021. That was bigger than the median market forecast for a 2.6% gain.
The unemployment rate was 2.5% from 2.6% in the previous month, while an index measuring job availability came in at 1.23.
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Reporting by Daniel Leussink; Additional reporting by Yoshifumi Takemoto and Kantaro Komiya; Editing by Sam Holmes
Our standards: The Thomson Reuters Trust Principles.
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