1 September 2009

Industrial product in Japan continues its rise

In a good sign for the world's second largest economy, Japan's factory output rose for the fifth straight month in July and experts expect it to keep climbing.

Industrial production climbed 1.9% from the previous month and “continues to show an upward movement,” the Ministry of Economy, Trade and Industry said Monday.

The results beat a 1.6% rise forecast in Kyodo news agency’s survey of economists. Strong gains among companies making transport equipment and steel products fueled the increase.

Japan’s economy emerged from a yearlong recession in the second quarter, lifted by a rebound in exports as governments around the world infused their economies with stimulus money. Manufacturers expect factory output to rise 2.4% in August and 3.2% in September.

While all this is good news, the country’s economy remains weak, with unemployment rising to a record 5.7%. Industrial production is still more than 22% lower than it was a year ago, just before the eruption of the global financial crisis.

Consumers are spending less money amid economic anxieties. A separate report showed retail sales fell 2.5% in July from a year earlier, the 11th straight monthly decline.

For related information, go to www.isa.org/productivity.