Japan factory output up in December, beating expectations

[TOKYO] Japan's factory output rose more than expected in December, as production of automobile-related parts and other machines expanded, government data showed Wednesday.

The figures showed industrial production was up 2.7 per cent, the third consecutive monthly rise after a 0.5 per cent rise each in October and in November.

It beat market expectations of a 1.5 per cent rise.

The latest data, released by the industry ministry, comes as Japan has notched up seven straight quarters of economic growth - the longest positive run for 16 years - with the upcoming 2020 Olympic Games giving the economy a shot in the arm.

But it has struggled to put to rest deflation fears, failing to achieve the 2.0-per cent inflation rate target set by the central bank, which is thought crucial to boosting the economy.

The government and central bank hope to see a "virtuous cycle", with an export-led recovery having a positive impact on jobs and household income and thereby boosting domestic demand, which accounts for roughly 60 per cent of Japan's economy.

On Tuesday, internal ministry data showed that the country's household spending slipped 0.1 per cent in December while the jobless rate edged up to 2.8 per cent from 2.7 per cent the previous month.

AFP