The Ministry of Economy, Trade and Industry (METI) in Japan has reported a seasonally adjusted 7.5 percent decrease in industrial output for the month of January. This drop is more severe than forecasted, which had anticipated a 6.7 percent decline, and clearly contrasts with the 1.4 percent increase seen in December.
When comparing with last year's data, there has been a 1.5 percent decrease in industrial production, which is a clear step down from the previous month's minor 0.7 percent reduction.
In light of this data, the METI has had to downgrade its overall assessment of industrial production, stating that while there continues to be fluctuation, the overall trend appears to be weakening.
Key contributions to this decline come from industries such as motor vehicles, business-oriented machinery, and electrical machinery. However, the downward trend has been slightly balanced out by an increase in the transport equipment sector.
Meanwhile, shipment figures suffered an 8.3 percent drop for the month and a 1.7 percent drop for the year. Inventories also saw decreases of 1.8 percent for the month and 1.3 percent for the year. In contrast, the inventory ratio increased by 3.9 percent for the month and 1.3 percent for the year.
Looking ahead, the METI's predictions for industrial production show an expected increase of 4.8 percent for the month of February, and a further 2.0 percent increase in March.
Industries expected to drive this anticipated growth in February include transport equipment, business-oriented machinery, and electrical machinery. For March, production machinery, transport equipment, and chemicals sectors are expected to contribute to the gains.
In other economic news, the METI also announced that January saw a 2.3 percent increase in retail sales, beating the forecasted 2.0 percent increase, and the total value reached 13.141 trillion yen.
On a monthly level, and when adjusted for seasonal variations, retail sales saw a positive 0.8 percent change - an improvement when compared to the 2.6 percent decrease seen a month prior.
Commercial sales, however, were down 2.9 percent for the month, but up by 0.9 percent for the year, totalling 45.711 trillion yen. Additionally, wholesale sales experienced a significant decrease, dropping 4.8 percent for the month, while it experienced a slight 0.4 percent increase for the year, reaching 32.570 trillion yen.
