Wednesday, November 30

Japan’s Feb factory output rises for first time in 3 months


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TOKYO — Japan’s factory output posted its first rise in three months in February as robust global demand led to a rebound in car production, a welcome sign for policymakers hoping to keep the country’s fragile economic recovery on track.

The increase, however, was smaller than market expectations, underscoring the lingering impact of supply chain bottlenecks and other risks such as surging costs of raw materials.

Factory output rose 0.1% in February from the previous month, official data showed on Thursday, as growing production of cars and transport equipment offset a decline in chemicals.

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That meant output returned to growth after slipping 0.8% in January and 1.0% in December. The increase was weaker than a 0.5% gain forecast in a Reuters poll of economists.

The outlook for the world’s third-largest economy has become more unpredictable after energy and commodity prices soared following the start of Russia’s war in Ukraine, saddling Japan’s exporters with high import cost for raw materials.

Japanese automakers and suppliers are facing headwinds from coronavirus-related disruptions in China, the world’s largest market, which are adding to problems created by the war in Ukraine.

Thursday’s data showed output of cars and other motor vehicles gained 10.9% from the previous month in February, rebounding after a sharp contraction in January as pressure from parts shortages eased.

Manufacturers surveyed by the Ministry of Economy, Trade and Industry (METI) expected output to advance 3.6% in March and 9.6% in April.

(Reporting by Daniel Leussink; Editing by Sam Holmes)



financialpost.com