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MNI BRIEF: Japan Nov Factory Output Drop First In Three Months

(MNI) Tokyo

Japan's industrial output fell 0.9% m/m in November for the first drop in three months following a 1.3% rise in October, hit by lower production of motor vehicles and electrical machinery, and information and communication electronics equipment, data released by the Ministry of Trade and Industry showed on Thursday.

The November data was largely in line with the view made by the Bank of Japan that industrial production has been more or less flat.

Production for automobiles fell 2.5% m/m in November for the first drop in three months following 2.0% in October.

Based on its survey of manufacturers, METI projected that industrial production would rise 6.0% in December, revised up from 3.2% forecast last month, before falling 7.2% in January.

Adjusting the upward bias in output plans, METI forecast production would rise 3.2% m/m in December.

Based on this assumption, production will rise 1.8% q/q between October-December, the first rise in two quarters following Q3's 1.2% fall.

METI left its assessment from the previous month, noting industrial production is marking time. Industrial output is a key piece of data for BOJ economists to assess and predict the pace of the current modest economic recovery as it reflects both external and domestic demand.

MNI Tokyo Bureau | +81 90-2175-0040 |
MNI Tokyo Bureau | +81 90-2175-0040 |

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